TMX Terminix Global Holdings Inc

PART I

RISK FACTORS

Any investment in the Rentokil Initial Shares is subject to a number of risks. Prior to investing in the Rentokil Initial Shares, prospective investors should carefully consider risk factors associated with any investment in the Rentokil Initial Shares, the business of Rentokil Initial and, following Completion, the Combined Group and the pest control industry as a whole, together with all other information contained in this document, including in particular the risk factors described below, and consult with their professional advisers.

Prospective investors should note that the risks summarised in the section of this document entitled “Summary” are the risks that the Company has assessed to be the most essential to an assessment by a prospective investor of whether to consider an investment in the Rentokil Initial Shares. However, as the risks that Rentokil Initial faces and, following Completion, the Combined Group will face, relate to events and depend on circumstances that may or may not occur in the future, prospective investors should consider not only the information on the key risks summarised in the section of this Prospectus entitled “Summary Information” but also, among other things, the risks and uncertainties described below.

Rentokil Initial Shareholders should also consider the following risks and uncertainties together with all the other information set out in, or incorporated by reference into, this document prior to making any decision as to whether or not to vote in favour of the Transaction.

If any of the following risks were to occur, this could have a material adverse effect on the business, reputation, results of operations, financial condition or prospects of Rentokil Initial, Terminix or, following Completion, the Combined Group, the value of the Rentokil Initial Shares could decline and Rentokil Initial Shareholders could lose all or part of the value of their investment in Rentokil Initial Shares.

In addition, the risks described below are based on information known at the date of this document but may not be the only risks to which Rentokil Initial, Terminix or, following Completion, the Combined Group is or might be exposed to or that prospective investors may face when making an investment in the Rentokil Initial Shares. Additional risks and uncertainties relating to Rentokil Initial, Terminix or, following Completion, the Combined Group, which are currently unknown to Rentokil Initial plc or that Rentokil Initial plc does not currently consider to be material, could have a material adverse effect on the business, reputation, results of operations, financial condition and/or prospects of Rentokil Initial, Terminix or, following Completion, the Combined Group. If any of the following risks were to occur, the business, financial condition, results of operations and/or prospects of Rentokil Initial, Terminix or, following Completion, the Combined Group could be materially adversely affected and the value of the Rentokil Initial Shares could decline and Rentokil Initial Shareholders could lose all or part of the value of their investment in Rentokil Initial Shares.

Risks related to the Transaction

There is no assurance when or if the Transaction will be completed.

Completion is conditional upon a number of Conditions as set forth in the Merger Agreement, including, among others:

There can be no assurance as to when these Conditions will be satisfied or waived, if at all, or that other events will not intervene to delay or result in the failure to complete the Transaction.

The Rentokil Initial General Meeting will take place before all of the required Conditions have been satisfied and before all matters relevant to the satisfaction of Conditions, if any, are known. Notwithstanding the foregoing, if the Transaction is approved by Rentokil Initial Shareholders, Rentokil Initial plc may not be required to seek further approval of Rentokil Initial Shareholders.

Because the market value of Rentokil Initial Shares may fluctuate and the exchange ratio and per share cash amount are both fixed, Rentokil Initial cannot be sure of the market value of the Merger Consideration that it will pay in the Transaction.

Upon Completion, Terminix Shareholders will be entitled to receive for each Terminix Share that they own, at the election of each shareholder, subject to certain allocation and proration provisions in the Merger Agreement, either (i) a number of New Rentokil Initial ADSs (each representing a beneficial interest in five New Rentokil Initial Shares) equal to (A) the exchange ratio plus (B) the quotient of the per share cash amount and the Rentokil Initial ADS price; or (ii) an amount in cash, without interest, and in USD equal to (A) the per share cash amount plus (B) the product of the exchange ratio and the Rentokil Initial ADS price. Based on Rentokil Initial plc’s five-day average daily volume weighted share price and the five-day average of the £:US$ exchange rate, in each case, over the period spanning 6 December 2021 to 10 December 2021, inclusive, the implied value of the Merger Consideration to Terminix Shareholders as at the date of announcement of the Transaction was US$55.00 per Terminix Share. Based on Rentokil Initial plc’s five-day average daily volume weighted share price and the five-day average of the £:US$ exchange rate, in each case, over the period spanning 24 August 2022 to 31 August 2022 (the latest practicable trading day before the date of this document), inclusive, the implied value of the Merger Consideration to Terminix Shareholders was approximately US$43.33 per Terminix Share.

The Merger Consideration will not be adjusted to reflect the comparative value of pounds sterling and the US dollar or the market value of Rentokil Initial Shares or the Terminix Shares. Therefore, the aggregate market value of the New Rentokil Initial Shares that Rentokil Initial plc is required to issue at the time of Completion could vary significantly from the value of the Rentokil Initial Shares on the date of this document or the date of the Rentokil Initial General Meeting.

Rentokil Initial plc or Terminix Holdings may waive one or more of the Conditions without re-soliciting shareholder approval.

Certain conditions to Rentokil Initial plc and Terminix Holdings’ obligations, respectively, to complete the Transaction may be waived, in whole or in part, to the extent legally permissible, either unilaterally or by agreement by either Rentokil Initial plc or Terminix Holdings. In the event that any such waiver does not require further shareholder approval or a supplement to this document or any re-solicitation of proxies or voting cards (as applicable), the parties will have the discretion to complete the Transaction without seeking further approval of Rentokil Initial Shareholders or Terminix Shareholders, as applicable.

Except in specified circumstances, if the Transaction is not completed by 31 December 2022, subject to certain extensions in specified circumstances by either Rentokil Initial or Terminix, either Rentokil Initial or Terminix may choose not to proceed with the Transaction.

Either Rentokil Initial plc or Terminix Holdings may terminate the Merger Agreement if the Transaction has not been completed by 31 December 2022. However, this right to terminate the Merger Agreement will not be available to Rentokil Initial plc or Terminix Holdings if such party’s material breach of any of its obligations under the Merger Agreement has been the proximate cause of or resulted in the failure of the Transaction to be completed on or before such time. The end date may be extended by Rentokil Initial plc or Terminix Holdings to the Extended Long Stop Date if at the time of any such extension the antitrust-related Conditions are not satisfied but all other Conditions (other than Conditions that by their terms can only be satisfied on the date of Completion) have been satisfied or waived.

Terminix is, and Rentokil Initial may become, the target of securities class actions and derivative lawsuits which could result in substantial costs and may delay or prevent the Transaction from being completed.

As at the date of this document, three securities stockholder derivative lawsuits have been brought against Terminix Holdings and its directors and one draft complaint has been sent to Terminix Holdings. Such lawsuits are often brought against companies that have entered into merger agreements. Even if the lawsuits are without merit, defending against these claims can result in substantial costs and divert management time and resources. Additionally, if a plaintiff is successful in obtaining an injunction prohibiting Completion, then that injunction may delay or prevent the Transaction from being completed. Given the early stage of the existing proceedings, it is impossible to predict the outcome or estimate possible loss or range of loss.

While the Merger Agreement is in effect, Rentokil Initial plc, Terminix Holdings and their respective subsidiaries’ businesses are subject to restrictions on their business activities.

Under the Merger Agreement, Rentokil Initial plc, Terminix Holdings and their respective subsidiaries are subject to certain restrictions on the conduct of their respective businesses and generally must operate their respective businesses in the ordinary course prior to completing the Transaction (unless Rentokil Initial plc or Terminix Holdings obtains the other’s consent, as applicable, which is not to be unreasonably withheld, conditioned or delayed), which may restrict Rentokil Initial plc’s and Terminix Holdings’ ability to exercise certain of their respective business strategies. These restrictions may prevent Rentokil Initial plc and Terminix Holdings from pursuing otherwise attractive business opportunities, making certain investments or acquisitions, selling assets, engaging in capital expenditures in excess of certain agreed limits, continuing share repurchase programmes, incurring indebtedness or making changes to Rentokil Initial plc’s and Terminix Holdings’ respective businesses prior to the Completion or termination of the Merger Agreement, as applicable. These restrictions could have an adverse effect on Rentokil Initial plc’s and Terminix Holdings’ respective businesses, financial results, financial condition or share price.

In addition, the Merger Agreement prohibits Rentokil Initial plc from (i) soliciting, initiating, knowingly facilitating or knowingly encouraging, subject to certain exceptions set forth in the Merger Agreement, any inquiry or the making or submission of any proposal or offer that constitutes an acquisition proposal (as defined for each party in the Merger Agreement), (ii) (A) entering into or participating in any discussions or negotiations with any third party, (B) furnishing to any third party any information, or (C) otherwise assisting, participating in, knowingly facilitating or knowingly encouraging any third party, in each case, in connection with or for the purpose of knowingly encouraging or facilitating, an acquisition proposal, or (iii) approving, recommending or entering into (or publicly or formally proposing to approve, recommend or enter into), any letter of intent or similar document, agreement, commitment or agreement in principle with respect to an acquisition proposal. These restrictions may prevent Rentokil Initial plc from pursuing a transaction that may be more attractive than the Transaction. These restrictions could have an adverse effect on Rentokil Initial plc’s business, financial results, financial condition or share price.

The Combined Group may not realise all of the anticipated benefits of the Transaction.

There is a risk that some or all of the expected benefits of the Transaction may fail to materialise, or may not occur within the time periods anticipated by Rentokil Initial plc and Terminix Holdings. The realisation of such benefits may be affected by a number of factors, many of which are beyond the control of Rentokil Initial plc and Terminix Holdings. The challenge of integrating previously independent businesses makes evaluating the business and future financial prospects of the Combined Group following the Transaction difficult. Rentokil Initial and Terminix have operated and, until Completion, will continue to operate, independently. The success of the Transaction, including anticipated benefits and cost savings, will depend, in part, on the ability to successfully integrate the operations of both companies in a manner that results in various benefits, including, among other things, an expanded market reach and operating efficiencies that do not materially disrupt existing customer relationships (including as a result of customer relationships based on personal relationships being disrupted or lost due to personnel changes) nor result in decreased revenues or dividends due to the full or partial loss of customers. The past financial performance of each of Rentokil Initial plc and Terminix Holdings may not be indicative of the future financial performance of the Combined Group.

Failure to realise all of the anticipated benefits of the Transaction may impact the financial performance of the Combined Group, the price of the Rentokil Initial Shares and the Rentokil Initial ADSs and the ability of the Combined Group to continue paying dividends on its shares at levels per share consistent with the current dividend or at all. The declaration of dividends by the Combined Group will be at the discretion of its board of directors, which may determine at any time to cease paying dividends, lower the dividend level per share or not increase the dividend level per share.

The Transaction may not be accretive, and may be dilutive, to Rentokil Initial plc’s earnings per share, which may negatively affect the market price of Rentokil Initial Shares and the implied value of the Rentokil Initial ADSs following the Transaction.

In connection with Completion, Rentokil Initial plc expects to issue approximately 645 million new Rentokil Initial Shares, in the form of New Rentokil Initial ADSs, and certain Terminix Holdings equity awards are required to be converted into equity awards of Rentokil Initial plc pursuant to the Merger Agreement. The issuance of new Rentokil Initial Shares, in the form of New Rentokil Initial ADSs, could have the effect of depressing the market price of Rentokil Initial Shares.

Rentokil Initial plc currently projects that the Transaction will result in a number of benefits, including increased scale and an enlarged platform for profitable growth, and that it will ultimately be accretive to Rentokil Initial plc’s earnings per share. This projection is based on preliminary estimates that may materially change. Future events and conditions could reduce or delay the accretion that is currently projected or result in the Transaction being dilutive to Rentokil Initial plc’s earnings per share, including adverse changes in market conditions, additional transaction and integration related costs and other factors such as the failure to realise some or all of the benefits anticipated in the Transaction. Any dilution of, reduction in or delay of any accretion to, Rentokil Initial plc’s earnings per share could cause the price of Rentokil Initial Shares and the implied value of the Rentokil Initial ADSs to decline or grow at a reduced rate.

The additional indebtedness that Rentokil Initial will incur in connection with Completion could adversely affect the Combined Group’s financial position, including by decreasing Rentokil Initial’s (and with effect from Completion, the Combined Group’s) business flexibility and result in a decline in the Combined Group’s credit rating.

Following Completion, the Combined Group will have increased borrowings compared to Rentokil Initial’s historic level of borrowings. Rentokil Initial’s consolidated borrowings were £3.8 billion (US$4.7 billion converted at the £:US$ exchange rate on 30 June 2022) as of 30 June 2022. The Combined Group’s pro forma borrowings as of 30 June 2022, if the Transaction had been completed on that same date, would have been approximately £4.6 billion, of which approximately £1.2 billion would have been at variable rates of interest when assuming borrowings for the Transaction are made under the term facility.

Rentokil Initial plc has incurred approximately US$2.0 billion of additional debt in connection with the Transaction and may incur up to a further US$700 million of additional debt in connection with the Transaction. This increased level of borrowing could have the effect, among other things, of reducing the Combined Group’s flexibility to respond to changing business and economic conditions and will have the effect of increasing the Combined Group’s interest expenses. In addition, the amount of cash required to service the Combined Group’s increased borrowing levels and increased aggregate dividends following Completion and thus the demands on the Combined Group’s cash resources will be greater than the amount of cash flow required to service Rentokil Initial’s borrowings and pay dividends prior to the Transaction. The increased levels of borrowings and any increase in dividends following Completion could also reduce funds available for the Combined Group’s investments in M&A, research and development, capital expenditures and other activities and may create competitive disadvantages for the Combined Group relative to other companies with lower debt levels.

Rentokil Initial’s credit rating impacts the cost and availability of future borrowings and, accordingly, Rentokil Initial’s cost of capital. Rentokil Initial’s credit rating reflects each credit rating organisation’s opinion of Rentokil Initial’s financial and business strength, operating performance and ability to meet its debt obligations. Although Rentokil Initial’s credit rating was reaffirmed by S&P Global Ratings (“S&P”) as BBB following the announcement of the Transaction, if Rentokil Initial’s (and with effect from Completion, the Combined Group’s) credit rating declines, Rentokil Initial (and with effect from Completion, the Combined Group) may not be able to sell additional debt securities, borrow money, refinance the Transaction Facilities if drawn or establish alternatives to the Transaction Facilities in the amounts or at the times or interest rates contemplated thereby (or at all) or upon more favourable terms and conditions that might be available if Rentokil Initial’s current credit rating is maintained.

The cost of certain of Rentokil Initial’s existing indebtedness will also increase in the event that Rentokil Initial’s credit rating is sub-investment grade. In addition, future borrowings under circumstances in which the Combined Group’s debt is rated below investment grade may contain further restrictions that impose significant restrictions on the way the Combined Group operates following the Transaction.

This risk factor is not intended to qualify the Company’s and the Combined Group’s working capital statements.

An increase in interest rates would increase the cost of servicing Rentokil Initial’s debt and could adversely impact its business, results of operations, financial condition and/or prospects.

Facility B, which forms part of Rentokil Initial’s Transaction financing, will bear interest at a floating rate. As a result, to the extent Rentokil Initial has not hedged against rising interest rates, an increase in the applicable benchmark interest rates would increase the cost of servicing the debt in the future and could materially and adversely affect Rentokil Initial’s results of operations, financial condition, liquidity and cash flows. In addition, if Rentokil Initial refinances its indebtedness and interest rates increase between the time an existing financing arrangement was consummated and the time such financing arrangement is refinanced, the cost of servicing debt would increase, which could have a material adverse effect on Rentokil Initial’s business, results of operations, financial condition and/or prospects.

Prior to Completion, each of Rentokil Initial and Terminix (and with effect from Completion, the Combined Group) may have difficulty attracting, motivating and retaining executives and other employees in light of the Transaction.

The Combined Group’s success after Completion will depend in part on its ability to retain key executives and other employees. Uncertainty about the effect of the Transaction on employees of Rentokil Initial and Terminix may have an adverse effect on each of Rentokil Initial and Terminix and consequently on the Combined Group. This uncertainty may, prior to Completion, impair Rentokil Initial’s and/or Terminix’s, and post-Completion the Combined Group’s, ability to attract, retain and motivate personnel. Employee retention may be particularly challenging during the pendency of the Transaction, as employees of Rentokil Initial and Terminix may experience uncertainty about their future roles in the Combined Group.

Additionally, Terminix’s officers and employees may hold Terminix Shares and/or certain equity awards, and, if the Transaction is completed, these officers and employees may be entitled to the Merger Consideration in respect of such Terminix Shares and/or certain equity awards. Under agreements between Terminix and certain of its employees, such employees could potentially resign from employment on or after Completion that could result in severance payments to such employees and accelerated vesting of their equity awards. These payments and accelerated vesting benefits, individually or in the aggregate, could make retention of Terminix employees more difficult.

Furthermore, if employees of Rentokil Initial or Terminix depart or are at risk of departing, including because of issues relating to the uncertainty and difficulty of integration, financial security or a desire not to become employees of the Combined Group, Rentokil Initial may have to incur significant costs in retaining such individuals or in identifying, hiring and retaining replacements for departing employees and may lose significant expertise and talent. As a result, the Combined Group’s ability to realise the anticipated benefits of the Transaction may be materially and adversely affected. No assurance can be given that the Combined Group will be able to attract or retain employees to the same extent that Rentokil Initial and Terminix have been able to attract or retain employees in the past.

Certain Terminix agreements may contain change of control or anti-assignment provisions that may be triggered by the Transaction and that, if acted upon or not waived, could cause the Combined Group to lose the benefit of such agreements and incur liabilities or replacement costs, which could have an adverse effect on the Combined Group.

Terminix is party to, or may become party to after the date of this document, various agreements with third parties that may contain change of control or anti-assignment provisions that may be triggered upon Completion. Agreements with such provisions may provide for or permit the termination of the agreement upon the occurrence of a change of control of, or the assignment of such contract by, one of the parties unless it is waived by the relevant counterparties. In the event that there is such a contract or arrangement requiring a consent or waiver in relation to the Transaction, for which such consent or waiver was not obtained, the Combined Group could lose the benefit of the underlying agreement and incur liabilities or replacement costs, which could have an adverse effect on the business, results of operations, financial condition and/or prospects of the Combined Group.

The announcement and pendency of the Transaction could adversely affect Rentokil Initial’s and Terminix’s respective businesses, results of operations, financial condition and/or prospects.

The announcement and pendency of the Transaction could cause disruptions in and create uncertainty surrounding Rentokil Initial’s and Terminix’s business, including affecting their relationships with existing and future customers and suppliers, which could have an adverse effect on Rentokil Initial’s and Terminix’s business, results of operations, financial condition and/or prospects, regardless of whether the Transaction is completed. Rentokil Initial and Terminix could also potentially lose customers or suppliers, and new customer or supplier contracts could be delayed or decreased. In addition, each of Rentokil Initial plc and Terminix Holdings has expended, and continues to expend, significant management resources in an effort to complete the Transaction, which are being diverted from Rentokil Initial’s and Terminix’s day-to-day operations.

If the Transaction is not completed, Rentokil Initial plc’s and Terminix Holdings’ share prices may fall if and to the extent that the current prices of Rentokil Initial Shares and Terminix Shares reflect a market assumption that the Transaction will be completed. In addition, the failure to complete the Transaction may result in negative publicity or a negative impression of Rentokil Initial in the investment community and may affect Rentokil Initial’s relationship with colleagues, customers, suppliers and other partners in the business community.

Rentokil Initial plc and Terminix Holdings will incur substantial transaction fees and costs in connection with the Transaction.

Rentokil Initial plc and Terminix Holdings have incurred and expect to incur additional material non-recurring expenses in connection with the Transaction and Completion, including costs relating to obtaining required approvals and in change in control payments. Rentokil Initial plc and Terminix Holdings have incurred significant financial services, accounting, tax and legal fees in connection with the process of negotiating and evaluating the terms of the Transaction. Additional significant unanticipated costs may be incurred in the course of coordinating the businesses of Rentokil Initial and Terminix after Completion. Even if the Transaction is not completed, Rentokil Initial plc and Terminix Holdings will need to pay certain costs relating to the Transaction incurred prior to the date the Transaction was abandoned, such as financial advisory, accounting, tax, legal, filing and printing fees. Such costs may be significant and could have an adverse effect on the parties’ future business, results of operations, financial condition and/or prospects.

In addition to its own fees and expenses, in the event the Rentokil Initial Shareholders do not approve the Resolutions, and as a result the Merger Agreement is terminated, Rentokil Initial plc may be required to pay by way of compensation an amount equal to US$50 million to Terminix Holdings. Rentokil Initial plc may also be required to pay Terminix Holdings by way of compensation a termination payment of US$150 million if the Merger Agreement is terminated under the circumstances specified in the Merger Agreement.

The Transaction may affect the application of new or existing tax rules to the Combined Group which could result in a material impact on the Combined Group’s cash tax liabilities and tax charges.

Changes in tax regimes, such as those that have been proposed by the current administration in the United States that include raising the corporate tax rate and raising the tax rate on global intangible low-taxed income, could result in a material impact on the cash tax liabilities and tax charges of the Combined Group. The Combined Group will have a greater presence in the United States following the acquisition of Terminix Holdings than the existing Rentokil Initial, which means that changes to tax rules in the United States could have a more significant impact. Such an impact could also arise from changes in the application of existing tax rules, including UK tax rules, to Rentokil Initial as a result of the Transaction. In either case, this could result in a reduction in financial results depending upon the nature of the change.

Risks related to Rentokil Initial and, with effect from Completion, the Combined Group

Risks relating to business strategies and operations

If Rentokil Initial (and with effect from Completion, the Combined Group) is unsuccessful in integrating acquisitions (including the Transaction) or if its disposals result in unexpected costs or liabilities, its business could be materially and adversely affected.

Rentokil Initial has a strategy that includes growth by acquisition, for example it acquired 52 new businesses in 2021. M&A activity is a core part of Rentokil Initial’s strategy to extend its geographic footprint and to improve its market share in existing locations, and Rentokil Initial (and with effect from Completion, the Combined Group) may continue to pursue strategic transactions in the future, which could involve acquisitions or disposals of businesses or assets. There are a number of risks to the successful integration of acquired businesses. These risks include the possibility that management may be distracted from regular business concerns by the need to integrate operations and that unforeseen difficulties can arise in integrating operations and systems and retaining and assimilating the employees. In addition, even where a diligent review of the businesses and/or properties acquired in connection with such acquisitions is performed in accordance with industry norms, such reviews may be incomplete and not necessarily reveal all existing or potential problems, including actual or contingent liabilities, or permit a full assessment of the deficiencies associated with the businesses or properties.

Any acquisition that Rentokil Initial (and with effect from Completion, the Combined Group) makes may not provide it with the benefits that were anticipated when entering into such acquisition. If Rentokil Initial fails to: (i) successfully integrate acquisitions into its existing organisational structures; (ii) deliver the revenue and profit targets; or (iii) deliver any expected synergy benefits such as cost savings, the acquired business may not achieve the expected financial and operational benefits which could lead to potential adverse short-term or long-term effects on Rentokil Initial’s (and with effect from Completion, the Combined Group’s) business, reputation, results of operations, financial condition and/or prospects.

There is a risk that the Transaction and integration of Rentokil Initial and Terminix may consume management time and resources, making the execution of M&A activity in furtherance of the Combined Group’s strategy more difficult to execute.

In addition, Rentokil Initial has sold a number of its businesses in the past and expects to continue to dispose of businesses from time to time if consistent with its strategy. Furthermore, under business sale contracts, Rentokil Initial (and with effect from Completion, the Combined Group) may provide warranties and indemnities to purchasers. Accordingly, Rentokil Initial (and with effect from Completion, the Combined Group) may make provisions in its consolidated financial statements for potential liabilities and costs relating to a disposed business. Rentokil Initial (and with effect from Completion, the Combined Group) may also make provision in its financial statements for amounts to cover legal or regulatory claims which are known to be outstanding at the time of sale or which may subsequently become apparent. There can be no assurance that such provisions will be sufficient to cover potential liabilities and consequently disposals of Rentokil Initial’s (and with effect from Completion, the Combined Group’s) businesses may have a material adverse effect on its business, reputation, results of operations, financial condition and/or prospects.

Rentokil Initial (and with effect from Completion, the Combined Group) may experience difficulties integrating, streamlining and optimising its IT systems, processes and technologies.

Rentokil Initial has invested in, and expects to continue to invest in, a wide range of new systems, processes and technologies intended to improve many aspects of its business. These systems, processes and technologies impact customers, suppliers, colleagues and others, including new systems that integrate, streamline and enhance legacy operating IT systems. These activities have required, and may continue to require, significant investment of human and financial resources. Rentokil Initial (and with effect from Completion, the Combined Group) may experience significant delays, increased costs and other difficulties as a consequence of significant disruption or deficiency in implementing such systems, processes and technologies, which could adversely affect Rentokil Initial’s (and with effect from Completion, the Combined Group’s) ability to process work orders, send invoices and track and collect payments, fulfil contractual obligations or otherwise operate its business. In addition, Rentokil Initial’s (and with effect from Completion, the Combined Group’s) efforts to centralise various business processes within its organisation in connection with this implementation may disrupt operations and negatively impact Rentokil Initial’s (and with effect from Completion, the Combined Group’s) business, reputation, results of operations, financial condition and/or prospects. Rentokil Initial may also experience difficulties, costs or delays in migrating acquired businesses to its systems, processes and technologies.

Rentokil Initial depends (and with effect from Completion, the Combined Group will depend) on a suitably skilled and qualified labour force to maintain the business.

Rentokil Initial’s ability to maintain its customer service and execute its business strategy depends on its ability to attract and retain a suitably skilled and qualified labour force. There can be no assurance that Rentokil Initial (and with effect from Completion, the Combined Group) will be able to recruit, train and retain such a labour force in sufficient numbers or of sufficient quality, or that pressure to recruit will not lead to a significant increase in colleague costs. In markets where overall employment rates are high, and/or its business is growing quickly either organically or through acquisitions, Rentokil Initial (and with effect from Completion, the Combined Group) may have difficulties attracting, training and retaining operational personnel of suitable capability. In addition, changes in the global job market (including those caused or accelerated by the COVID- 19 pandemic) may cause (or continue to cause) difficulty in recruiting, training and retaining a suitably skilled and qualified labour force. As a result, Rentokil Initial could experience difficulty in responding to customer calls in a timely fashion or delivering its services in a high-quality or timely manner, and could be forced to increase wages to attract, train and retain colleagues, which would result in higher operating costs and reduced profitability. Any of these factors may have a material adverse effect on Rentokil Initial’s (and with effect from Completion, the Combined Group’s) business, reputation, results of operations, financial condition and/or prospects.

Moreover, some of Rentokil Initial and Terminix’s colleagues and employees, respectively, are members of local trade unions and similar organisations. Industrial action in key operations could result in diminished customer service levels or higher costs and, if prolonged, could damage Rentokil Initial’s (and with effect from Completion, the Combined Group’s) reputation and ability to retain existing customers or acquire new customers. Although Rentokil Initial plc believes that all of Rentokil Initial’s operations have good relations with their colleagues and the trade unions that represent those colleagues (where applicable), there can be no assurance that work stoppages or other labour-related developments (including the introduction of new labour regulations in countries where Rentokil Initial (and with effect from Completion, the Combined Group) operates) will not adversely affect its business, reputation, results of operations, financial condition and/or prospects. In addition, potential competition from key colleagues who leave Rentokil Initial (and with effect from Completion, the Combined Group) could impact its ability to maintain its market share in certain geographic areas.

Rentokil Initial depends (and with effect from Completion, the Combined Group will depend) on key personnel to lead Rentokil Initial’s business.

Rentokil Initial’s (and with effect from Completion, the Combined Group’s) continued success will largely depend on its ability to attract, retain and develop a high calibre of talent and on the efforts and abilities of its executive officers and certain other key colleagues. As Rentokil Initial (and with effect from Completion, the Combined Group) continues to grow its business, make acquisitions, expand its geographic scope and offer new products and services, Rentokil Initial (and with effect from Completion, the Combined Group) needs the organisational talent necessary to ensure effective succession for executive officer and key colleague roles in order to meet the growth, development and profitability goals of its business. Rentokil Initial’s (and with effect from Completion, the Combined Group’s) operations could be materially and adversely affected if for any reason Rentokil Initial (and with effect from Completion, the Combined Group) was unable to attract, retain or develop such officers or key colleagues and successfully execute organisational change and management transitions at leadership levels.

ESG matters, including those related to climate change and sustainability, may have an adverse effect on Rentokil Initial’s (and with effect from Completion, the Combined Group’s) business, reputation, results of operations, financial condition and/or prospects.

Increased focus and activism related to ESG matters may hinder Rentokil Initial’s (and with effect from Completion, the Combined Group’s) access to capital, as investors may reconsider their capital investment as a result of their assessment of Rentokil Initial’s (and with effect from Completion, the Combined Group’s) ESG practices. Customers, consumers, investors and other stakeholders are increasingly focusing on ESG issues, including climate change, water use, deforestation, plastic waste, human and animal health and welfare, chemical usage and other concerns. Changing customer preferences are resulting in, and may continue to result in, increased demands regarding plastics and packaging materials, including single-use and non-recyclable plastic packaging, and other components of Rentokil Initial’s (and with effect from Completion, the Combined Group’s) products and their impact on human and animal health and environmental sustainability; a growing demand for natural, organic or non-toxic products and ingredients; or increased customer concerns or perceptions (whether accurate or inaccurate) regarding the effects of ingredients or substances present in certain products. Certain animal welfare advocacy groups may raise concerns regarding products such as glue boards or snap traps perceived to have animal cruelty issues. These demands, perceptions and preferences could cause Rentokil Initial (and with effect from Completion, the Combined Group) to incur additional costs or to make changes to its operations to comply with such demands and customer preferences, and a delay in Rentokil Initial’s (and with effect from Completion, the Combined Group’s) response (or the failure to respond effectively) may lead to adverse effects to its business, results of operations and financial condition, and recruitment and retention of the labour force that it needs.

Concern over climate change or plastics and packaging materials, in particular, may result in new or increased legal and regulatory requirements to reduce or mitigate impacts to the environment. Increased regulatory requirements, including in relation to various aspects of ESG including disclosure requirements, may result in increased compliance costs or input costs of energy and raw materials, which may cause disruptions in the manufacture of Rentokil Initial’s (and with effect from Completion, the Combined Group’s) products or an increase in operating costs, and these costs could have a material adverse effect on Rentokil Initial’s (and with effect from Completion, the Combined Group’s) results of operations and cash flows. Any failure to achieve its ESG goals or a perception (whether or not valid) of its failure to act responsibly with respect to ESG issues or to effectively respond to new, or changes in, legal or regulatory requirements concerning environmental or other ESG matters, or increased operating or manufacturing costs due to increased regulation could adversely affect Rentokil Initial’s (and with effect from Completion, the Combined Group’s) business, reputation, results of operation, financial condition and/or prospects. In addition, Rentokil Initial (and with effect from Completion, the Combined Group) may also be adversely impacted as a result of conduct by contactors, customers or suppliers that fail to meet Rentokil Initial’s (and with effect from Completion, the Combined Group’s) or its stakeholders’ ESG standards.

Inflationary pressures, such as increases in wages, fuel prices and other operating costs, could adversely impact Rentokil Initial’s (and with effect from Completion, the Combined Group’s) business, results of operations, financial condition and/or prospects.

Rentokil Initial’s (and with effect from Completion, the Combined Group’s) financial performance may be adversely affected by sudden or material increases in the level of its operating costs and expenses, which may be subject to inflationary pressures, and it may not be able to pass these increases on fully, or in a timely manner, to customers. For example, fuel prices are subject to market volatility, and Rentokil Initial’s and Terminix’s fleet has been negatively impacted by significant increases in fuel prices in the past and could be negatively impacted in the future. In addition, Rentokil Initial continues to monitor any adverse impact that the ongoing conflict in Ukraine and the subsequent institution and extension of sanctions against various Russian organisations, companies and individuals, may have on the global economy in general and on Rentokil Initial’s business operations, although neither Rentokil Initial nor Terminix has any direct operations in Russia or the Ukraine. Such events have increased fuel prices, and a prolonged conflict may have further negative consequences such as increased inflation and transportation costs. Fuel price increases have also caused increases in the cost of chemicals and other materials used in Rentokil Initial’s (and with effect from Completion, the Combined Group’s) business. Increases in fuel, and other costs, have not negatively affected Rentokil Initial’s results of operations as of 30 June 2022, as Rentokil Initial has been able to pass along such increases to customers in the form of increased prices. However, Rentokil Initial cannot predict the extent to which it may experience future cost increases. To the extent such costs increase further, Rentokil Initial (and with effect from Completion, the Combined Group) may be prevented, in whole or in part, from passing these cost increases on to its existing and prospective customers, which could have a material adverse impact on Rentokil Initial’s (and with effect from Completion, the Combined Group’s) results of operations, financial condition and/or prospects.

Supply chain issues may result in product shortages or disruptions to Rentokil Initial’s (and with effect from Completion, the Combined Group’s) business.

Rentokil Initial has a complex global network of suppliers that has recently expanded to meet increased customer demand and may, in the future, further evolve in response to market conditions. Although the majority of the products used by Rentokil Initial are generally available from multiple sources, and alternatives have been generally available in the event of disruption in the past, Rentokil Initial (and with effect from Completion, the Combined Group) could experience material disruptions in production and other supply chain issues (including as a result of current global supply issues affecting microchips and printed circuit boards), which could result in out-of-stock conditions, and its results of operations and relationships with customers could be adversely affected (a) if new or existing suppliers are unable to meet any standards set by Rentokil Initial (and with effect from Completion, the Combined Group), government or industry regulations or customers, (b) if Rentokil Initial (and with effect from Completion, the Combined Group) is unable to contract with suppliers at the quantity, quality and price levels needed for its business, or (c) if any of Rentokil Initial’s (and with effect from Completion, the Combined Group’s) key suppliers becomes insolvent, ceases or significantly reduces its operations or experiences financial distress.

Rentokil Initial’s (and with effect from Completion, the Combined Group’s) inability to fully or substantially meet customer demand due to supply chain issues could result in, among other things unmet consumer demand leading to reduced preference for Rentokil Initial’s (and with effect from Completion, the Combined Group’s) products or services in the future, customers purchasing products and services from competitors as a result of such shortage of products, strained customer relationships, termination of customer contracts, additional competition and new entrants into the market, and loss of potential sales and revenue, which could adversely affect Rentokil Initial’s (and with effect from Completion, the Combined Group’s) business, reputation, results of operations, financial condition and/or prospects.

Weakening general economic conditions, including rising unemployment or decreased consumer confidence or spending levels, especially as they may affect demand from Rentokil Initial’s (and with effect from Completion, the Combined Group’s) customers, may adversely impact its business, results of operations, financial condition and/or prospects.

Ongoing volatility in the global economic environment has led to, and may continue to lead to, economic challenges such as low gross domestic product growth in regional and national economies, high volatility in commodity prices and exchange rates and efforts made by governments to increase the minimum wage across markets, as well as wide variations in local market prices and cost inflation across the globe. This may be exacerbated by economic uncertainty caused by geopolitical events, political instability and civil unrest in some local markets, catastrophic business events, including the continuation and/or broadening of the conflict in the Ukraine and the impact of the COVID-19 pandemic. Further economic slowdown in the markets in which Rentokil Initial (and with effect from Completion, the Combined Group) operates may lead to a reduction in the level of demand from its customers for existing and new services. Low-growth economies with inherent cost inflation may make it difficult for Rentokil Initial (and with effect from Completion, the Combined Group) to maintain profitability if it has weak pricing power in those markets, in particular, if there are strong competitive pressures. Furthermore, adverse economic conditions may lead to an increased number of customers not renewing contracts or seeking to reduce prices leading to a reduction in profit margins and cash flows or being unable to pay for existing or additional services leading to an increase in bad debts. Any of these events could have a material adverse effect on Rentokil Initial’s (and with effect from Completion, the Combined Group’s) business, reputation, results of operations, financial condition and/or prospects.

Rentokil Initial (and with effect from Completion, the Combined Group) may not successfully implement its business strategies, including achieving its growth objectives.

Rentokil Initial (and with effect from Completion, the Combined Group) may not be able to fully implement its business strategies or realise, in whole or in part within the expected time frames, the anticipated benefits of various growth or other initiatives. Rentokil Initial’s (and with effect from Completion, the Combined Group’s) ability to implement its business strategy may be adversely affected by factors that Rentokil Initial plc cannot currently foresee, such as unanticipated costs and expenses, technological change, severe economic downturn (including as a result of the impact of the COVID-19 pandemic and/or the conflict in Ukraine), the level of interest rates, foreign exchange risks, failure to integrate acquisitions, a decline in the effectiveness of Rentokil Initial’s marketing (including digital marketing) activities or disruptions in the supply chain. All of these factors may necessitate changes to Rentokil Initial’s (and with effect from Completion, the Combined Group’s) business strategy or adversely affect its business, reputation, results of operations, financial condition and/or prospects.

In addition, Rentokil Initial (and with effect from Completion, the Combined Group) will incur certain costs to achieve efficiency improvements, systems implementations and growth in Rentokil Initial’s business, and Rentokil Initial (and with effect from Completion, the Combined Group) may not meet anticipated implementation timetables or stay within budgeted costs. As these efficiency improvements, system implementations and growth initiatives are implemented, Rentokil Initial (and with effect from Completion, the Combined Group) may not fully achieve expected cost savings and efficiency improvements, system implementations or growth rates, or these initiatives could adversely impact customer retention or its operations. Also, Rentokil Initial’s (and with effect from Completion, the Combined Group’s) business strategies may change in light of its ability to implement new business initiatives, competitive pressures, economic uncertainties or developments or other factors.

Rentokil Initial’s (and with effect from Completion, the Combined Group’s) continued growth depends on its ability to retain existing customers and attract new customers.

Rentokil Initial’s (and with effect from Completion, the Combined Group’s) ability to grow is dependent on its ability to retain existing customers and attract new customers. There can be no assurance that Rentokil Initial’s (and with effect from Completion, the Combined Group’s) strategy of using new technology and improved sales techniques to attract profitable new clients, up-selling and cross-selling to existing clients and focusing on retaining profitable business when renewing existing consumer contracts will be successful. Moreover, failure to maintain customer service, client management and sales capability, failure to adapt to local business and consumer needs and/or failure to win and retain profitable customers in the face of competition from competitors with lower costs or which are willing to accept lower margins may have a material adverse effect on Rentokil Initial’s (and with effect from Completion, the Combined Group’s) business, results of operations, financial condition and/or prospects.

Rentokil Initial (and with effect from Completion, the Combined Group) must be sufficiently agile to develop and deliver products and services that meet local market needs. If Rentokil Initial (and with effect from Completion, the Combined Group) is not able to adapt to local business and consumer needs, its existing customers may choose not to renew contracts, reduce the use of Rentokil Initial’s services across their operations or seek reductions in prices.

Rentokil Initial (and with effect from Completion, the Combined Group) must continue to develop products and services that meet the needs and expectations of its customer base, including to ensure the continued efficacy of its products in the target pest population. Furthermore, as technological developments disrupt the markets in which Rentokil Initial and Terminix operate and change service offerings across their industries, Rentokil Initial (and with effect from Completion, the Combined Group) may need to develop new products and services. In the future, products and services may interact with each other in new ways and offer new capabilities to consumers, such as systems that are networked and able to be monitored in real time. Rentokil Initial’s (and with effect from Completion, the Combined Group’s) competitors may be earlier to embrace these new technological developments that are disruptive to the market or to develop more effective products, and a delay in Rentokil Initial’s (and with effect from Completion, the Combined Group’s) response may lead to adverse effects to its business, reputation, results of operations, financial condition and/or prospects.

Rentokil Initial’s (and with effect from Completion, the Combined Group’s) industries are highly competitive.

Rentokil Initial and Terminix compete with a wide variety of competitors of varying sizes and face competition in many of the markets in which they operate. The growing presence of multinational competitors may increase the cost of acquisitions and/or drive down prices, impacting Rentokil Initial’s (and with effect from Completion, the Combined Group’s) profitability. Furthermore, the increased presence of facilities management companies in the markets in which Rentokil Initial (and with effect from Completion, the Combined Group) operates may also drive down prices and adversely impact the quality of relationships with end customers. The principal methods of competition in Rentokil Initial’s business include quality and speed of customer service, brand awareness and reputation, effective use of technology and systems, customer satisfaction, fairness of contract terms (including price and promotions), professional sales forces and referrals. Rentokil Initial (and with effect from Completion, the Combined Group) may be unable to compete successfully against current or future competitors, and the competitive pressures that Rentokil Initial (and with effect from Completion, the Combined Group) faces may result in reduced market share, reduced pricing or an adverse impact on its reputation, business, results of operations and financial condition.

Cybersecurity breaches, attacks and other similar incidents, as well as disruptions or failures in Rentokil Initial’s (and with effect from Completion, the Combined Group’s) IT systems or data security procedures and those of its third-party service providers, could expose Rentokil Initial (and with effect from Completion, the Combined Group) to liability, limit its ability to effectively monitor, operate and control operations and adversely impact its business, reputation, results of operations, financial condition and/or prospects.

Rentokil Initial’s and Terminix’s businesses are dependent on effective IT systems and data security procedures. Rentokil Initial, Terminix, and with effect from Completion, the Combined Group, and their third-party service providers may be subject to significant system or network disruptions from numerous causes, including cybersecurity breaches, attacks (including denial of service attacks) or other similar incidents, facility access issues, new system implementations, human error, fraud, theft, fire, power loss, telecommunications failure or a similar catastrophic event. Moreover, computer viruses, worms, malware, ransomware, phishing, spoofing, malicious or destructive code, social engineering, denial-of-service attacks, and other cyberattacks have become more prevalent and sophisticated in recent years. Because the techniques used by computer hackers and others to access or sabotage networks and computer systems constantly evolve and generally are not recognised until launched against a target, Rentokil Initial (and with effect from Completion, the Combined Group) and its third-party service providers may be unable to anticipate, detect, react to, counter or mitigate against all of these techniques or remediate any resulting incident. Cybersecurity risk has increased due to increased online and remote activity (a trend accelerated by the COVID-19 pandemic) and Rentokil Initial and Terminix have experienced a notable increase in the number and seriousness of cyberattacks, including repeated distributed denial of service attacks and attempted ransomware incidents in countries such as Brazil and Italy. The attacks were detected and prevented before they were able to have a material impact on the business, but it is possible that future cyberattacks could avoid detection or prevention and have such a material impact. Any IT system disruptions or breaches may lead to unauthorised release of data and inefficient business operations, including poor supply chain management, and have a negative impact on customer service, resulting in a loss of customers, which could have a material adverse effect on Rentokil Initial’s (and with effect from Completion, the Combined Group’s) business, reputation, results of operations, financial condition and/or prospects.

Rentokil Initial (and with effect from Completion, the Combined Group) may be required to expend significant additional resources to continue to modify or enhance its protective measures or to investigate or remediate any cybersecurity vulnerabilities, breaches, attacks or other similar incidents. Any cybersecurity incident, attack or other similar incident, or its failure to make adequate or timely disclosures to the public, regulators, or law enforcement agencies following any such event, could harm Rentokil Initial’s (and with effect from Completion, the Combined Group’s) competitive position, result in violations of applicable data privacy or cybersecurity laws or regulations, result in a loss of customer confidence in the adequacy of threat mitigation and detection processes and procedures, cause disruption to business activities, divert management attention and other resources or otherwise adversely affect the internal operations and reputation of Rentokil Initial (and with effect from Completion, the Combined Group), degrade financial results, cause it (and with effect from Completion, the Combined Group) to incur significant costs to remedy the damages caused by the incident or defend legal claims, subject it to additional regulatory scrutiny and expose Rentokil Initial (and with effect from Completion, the Combined Group) to civil litigation, fines, damages or injunctions. With respect to cybersecurity-related legal claims and regulatory scrutiny, Rentokil Initial also may incur additional costs related to the diverse set of laws, rules and regulations to which it is subject across multiple jurisdictions.

Extraordinary events may significantly impact Rentokil Initial’s (and with effect from Completion, the Combined Group’s) business if it is unable to ensure business continuity due to a material incident.

The ability to service customers without interruption is essential to Rentokil Initial’s (and with effect from Completion, the Combined Group) operations. Contingency plans are required to continue or recover operations following a disruption or incident. Such incidents may include (a) the loss or insolvency of a major distributor, (b) repeated or prolonged government shutdowns or similar events, (c) war (including acts of terrorism or hostilities which impact Rentokil Initial’s (and with effect from Completion, the Combined Group’s) markets), (d) natural or man-made disasters, (e) water shortages, (f) cybersecurity, IT or privacy-related incidents or (g) severe weather conditions affecting Rentokil Initial’s (and with effect from Completion, the Combined Group’s) operations or the food service, hospitality and travel industries may have a material adverse effect on Rentokil Initial’s (and with effect from Completion, the Combined Group’s) business. Inability to restore or replace critical capacity to an agreed level within an agreed time frame would prolong the impact of such disruption or incident and could lead to, among other things, negative publicity and reputational damage and could severely affect Rentokil Initial’s (and with effect from Completion, the Combined Group’s) business, reputation, results of operations, financial condition and/or prospects.

Rentokil Initial has (and with effect from Completion, the Combined Group will have) independent, third-party distributors, the loss of which could have an adverse effect on Rentokil Initial’s (and with effect from Completion, the Combined Group’s) business, reputation, results of operations, financial condition and/or prospects.

Government shutdowns can have a material adverse effect on operations or cash flows by disrupting or delaying new product launches, renewals of registrations for existing products and receipt of import or export licenses for raw materials or products.

War (including acts of terrorism or hostilities), natural or man-made disasters, water shortages or severe weather conditions affecting the food service, hospitality, travel and other industries can cause a downturn in the business of Rentokil Initial’s (and with effect from Completion, the Combined Group’s) customers, which in turn can have a material adverse effect on Rentokil Initial’s (and with effect from Completion, the Combined Group’s) business, results of operations, financial condition or prospects. Hurricanes or other severe weather events impacting the local markets could materially and adversely affect Rentokil Initial’s (and with effect from Completion, the Combined Group’s) ability to obtain raw materials at reasonable cost, or at all, and could adversely affect Rentokil Initial’s (and with effect from Completion, the Combined Group’s) business. The health and safety of Rentokil Initial’s (and with effect from Completion, the Combined Group’s) colleagues in local markets could be harmed by the detrimental effects of natural and man-made disasters, which could have a material adverse effect on its business, reputation, results of operations, financial condition and/or prospects.

Rentokil Initial (and with effect from Completion, the Combined Group) may not be able to adequately protect its intellectual property and other proprietary rights that are material to its business.

Rentokil Initial’s (and with effect from Completion, the Combined Group’s) ability to compete effectively depends in part on its ability to obtain, maintain, protect, defend and enforce its intellectual property and other proprietary rights, including the service marks, trademarks, trade names and other intellectual property rights Rentokil Initial (and with effect from Completion, the Combined Group) owns or licenses, particularly its brand names, including Rentokil, Initial, Ambius, Steritech, JC Ehrlich, Presto-X, Western Exterminator, Florida Pest Control, Eradico, Cannon, Sanitact, Ultraprotect, PestConnect, HygieneConnect, Entotherm, Calmic, Turf Fuel, Lumnia, Luminos, SOLitude, Batzner, Medentex, OnBrand360, Peter Cox, Environmental Pest Service, Pestfree365, Activap, Prokill, Micronclean and Microfresh, and following Completion, Terminix’s brand names including Terminix, Copesan, Assured Environments, Gregory, McCloud and Nomor. Rentokil Initial has not sought (and with effect from Completion, the Combined Group will not seek) to register or protect all of its intellectual property, including its trademarks, either in the UK, US or in every jurisdiction in which they are or may be used. Furthermore, because of the differences in foreign trademark, patent and other intellectual property laws, Rentokil Initial (and with effect from Completion, the Combined Group) may not receive the same protection in other countries as it would in the UK or the US.

If Rentokil Initial (and with effect from Completion, the Combined Group) is unable to protect its intellectual property and other proprietary rights, including brand names, it could cause a material adverse impact on its business, reputation, results of operations, financial condition and/or prospects. Litigation may be necessary to enforce Rentokil Initial’s (and with effect from Completion, the Combined Group’s) intellectual property rights and protect its proprietary information, or to defend against claims by third parties that its products, services or activities infringe their intellectual property rights.

Rentokil Initial relies, and, with effect from Completion, the Combined Group will rely, on third parties, including third-party vendors for business process outsourcing initiatives, investment counterparties, and, with effect from Completion, franchisees. Any termination or disruption of such relationships or counterparty default or litigation could have a material adverse effect on its business.

Rentokil Initial’s strategy to increase profitability, in part, by reducing its costs of operations, and to mitigate and manage its exposure to financial risk, includes the implementation of certain business process outsourcing initiatives and entry into arrangements with investment counterparties, including lenders, insurers and derivative counterparties. As such, Rentokil Initial is exposed to counterparty risk. Any disruption, termination or substandard performance of these outsourced services, including possible breaches by third-party vendors of their agreements with Rentokil Initial (and with effect from Completion, the Combined Group), or the failure of counterparties to discharge all or part of their obligations (including, for example, due to the deterioration of a counterparty’s actual or perceived creditworthiness) could adversely affect Rentokil Initial’s (and with effect from Completion, the Combined Group’s) reputation, customer and colleague relationships, results of operations and financial condition. Also, to the extent a third-party outsourcing provider or counterparty relationship is terminated, there is a risk of disputes or litigation and that Rentokil Initial (and with effect from Completion, the Combined Group) may not be able to enter into a similar agreement with an alternate provider in a timely manner or on terms that Rentokil Initial (and with effect from Completion, the Combined Group) considers favourable, and even if Rentokil Initial (and with effect from Completion, the Combined Group) finds an alternate provider, or chooses to insource such services or activities, there are significant risks associated with such transition.

In addition, to the extent Rentokil Initial (and with effect from Completion, the Combined Group) decides to terminate outsourcing services and insource such services, there is a risk that Rentokil Initial (and with effect from Completion, the Combined Group) may not have the capabilities to perform these services internally, resulting in a disruption to Rentokil Initial’s (and with effect from Completion, the Combined Group’s) business, which could adversely impact its business, reputation, results of operations, financial condition and/or prospects. Rentokil Initial (and with effect from Completion, the Combined Group) could incur costs, including personnel and equipment costs, to insource previously outsourced services like these, and these costs could adversely affect its results of operations and cash flows.

Third-party distributors, subcontractors, vendors and (in relation to the Combined Group) franchisees are independent third parties that Rentokil Initial does not (and with effect from Completion, the Combined Group will not) control, and who own, operate and oversee the daily operations of their businesses. If third party distributors, subcontractors, vendors and franchisees do not successfully operate their businesses in a manner consistent with required laws, standards and regulations, Rentokil Initial (and with effect from Completion, the Combined Group) could be subject to claims from regulators or legal claims for the actions or omissions of such third-party distributors, subcontractors, vendors and (in relation to the Combined Group) franchisees. In addition, Rentokil Initial’s (and with effect from Completion, the Combined Group’s) relationship with third party distributors, subcontractors, vendors and (in relation to the Combined Group) franchisees could become strained (including resulting in litigation) and these strains in relationships or claims could have a material adverse impact on Rentokil Initial’s (and with effect from Completion, the Combined Group’s) business, reputation, results of operations, financial condition and/or prospects.

From time to time, Terminix has received, and, with effect from Completion, the Combined Group may receive, communications from franchisees regarding complaints, disputes or questions about Terminix’s (and with effect from Completion, the Combined Group’s) practices and standards. If franchisees or groups representing franchisees were to bring legal proceedings against the Combined Group, this could adversely impact its business, reputation, results of operations, financial condition and/or prospects.

Rentokil Initial must and, with effect from Completion, the Combined Group will need to, maintain effective internal controls and, with effect from Completion, the Combined Group will need to ensure its internal control over financial reporting complies with the Sarbanes-Oxley Act.

Although Rentokil Initial maintains a strong focus on regular financial controls testing to mitigate the risk of fraud, financial crime, material misstatement of financial information or unintended release of personal data, including self-assessment exercises each year with independent testing by the external auditors, there can be no assurance that these controls are adequate or operate effectively. In addition, the increased trend to work from home also increased, and may continue to increase, the risk of potential fraud and requires Rentokil Initial (and with effect from Completion, the Combined Group) to focus on stronger financial control processes. In the event that these controls are not adequate or do not operate effectively to prevent fraud, financial crime, misstatement of financial or other records or the unintended release of personal data, this may result in incorrect financial information being released, loss of personal data of customers, suppliers or colleagues, financial loss, damage to Rentokil Initial’s (and with effect from Completion, the Combined Group’s) reputation and/or penalties imposed by regulators.

Rentokil Initial is not currently required to comply with the rules of the SEC implementing Section 404 of the Sarbanes-Oxley Act of 2002, as amended (the “Sarbanes-Oxley Act”) and is therefore not required to evaluate the effectiveness of its internal control over financial reporting. However, following its US listing and SEC registration, beginning as of the year ended 31 December 2023, Rentokil Initial plc will be required to evaluate the effectiveness of its internal control over financial reporting and its independent auditor will be required to audit management’s assessment of the effectiveness of its internal control over financial reporting.

While Rentokil Initial plc has yet to design and establish an internal control over financial reporting framework for the purposes of the effectiveness evaluation described above, Rentokil Initial plc has undertaken a preliminary assessment of its controls in connection with the preparation of the registration statement, of which this prospectus forms a part. In addition, during the preparation of its 2021 financial statements, Rentokil Initial identified errors to its 2020 and 2019 financial statements which resulted in restatements of those period. As a result of both the preliminary assessment and the restatements, Rentokil Initial plc identified the following material weaknesses in its internal control over financial reporting:

Though Rentokil Initial plc has started to design remediation measures in respect of these material weaknesses, it has not yet implemented or tested the effectiveness of the remediation measures. Moreover, Rentokil Initial plc cannot be certain that it will not identify other material weaknesses in its internal control over financial reporting as it designs, implements and tests its internal control over financial reporting framework in anticipation of its initial effectiveness evaluation. Moreover, when Rentokil Initial plc evaluates the effectiveness of its internal control over financial reporting in connection with its annual report for the year ended 31 December 2023, there can be no guarantee that Rentokil Initial plc or its independent auditor will not identify other material weaknesses in its internal control over financial reporting.

If Rentokil Initial plc fails to achieve and maintain effective internal control over financial reporting, it could suffer material misstatements in its consolidated financial statements, fail to meet its reporting obligations or fail to prevent fraud, which may cause investors to lose confidence in its reported financial information and subject Rentokil Initial plc to potential delisting from the NYSE, regulatory investigations and civil or criminal sanctions.

Rentokil Initial (and with effect from Completion, the Combined Group) may be required to recognise impairment charges or be subject to asset revaluations or downgrades.

Rentokil Initial has significant amounts of goodwill and intangible assets, such as customer lists. In accordance with applicable accounting standards, goodwill and indefinite-lived intangible assets are not amortised and are subject to assessment for impairment by applying a fair-value based test annually, or more frequently if there are indicators of impairment, including:

Based upon future economic and financial market conditions, the operating performance of Rentokil Initial (and with effect from Completion, the Combined Group) and other factors, including those listed above, Rentokil Initial (and with effect from Completion, the Combined Group) may incur impairment charges in the future, including in relation to the Transaction in respect of goodwill created and the value at which assets were recognised at Completion. It is possible that such impairment, if required, could be material. Any future impairment charges that Rentokil Initial (and with effect from Completion, the Combined Group) is required to record could have a material adverse impact on its business, results of operations, financial condition and/or prospects.

Risks relating to Legal and Compliance Matters

Government regulations and enforcement, and potential litigation, could have an adverse effect on Rentokil Initial’s (and with effect from Completion, the Combined Group’s) financial results.

As a global company, Rentokil Initial is subject to many laws and governmental regulations across all of the countries in which it conducts business, including laws and regulations involving marketing, antitrust, anti- bribery or anti-corruption, consumer protection, product liability, environmental, health and safety, intellectual property, data privacy or other matters, as well as potential litigation or administrative actions.

If Rentokil Initial (and with effect from Completion, the Combined Group) is unable to comply with all laws and regulations, it could negatively impact its reputation and business results. Rentokil Initial cannot provide assurance that its internal control policies and procedures, and ethics and compliance programme will always protect it from acts committed by Rentokil Initial’s (and with effect from Completion, the Combined Group’s) colleagues or agents. While it is Rentokil Initial’s policy and practice to comply with all legal and regulatory requirements applicable to its business, a finding that Rentokil Initial (and with effect from Completion, the Combined Group) is in violation of, or out of compliance with, applicable laws or regulations could subject it to civil remedies, including fines, damages, injunctions or product recalls, or criminal sanctions, any of which could adversely affect Rentokil Initial’s (and with effect from Completion, the Combined Group’s) business, reputation, results of operations financial condition and/or prospects. Even if a claim is unsuccessful, is without merit or is not fully pursued, the negative publicity surrounding such assertions regarding Rentokil Initial’s (and with effect from Completion, the Combined Group’s) products, processes or business practices could adversely affect Rentokil Initial’s reputation and brand image.

In addition, new or revised laws or regulations may alter the environment in which Rentokil Initial (and with effect from Completion, the Combined Group) does business which could adversely impact its financial results. For example, new legislation or regulations may result in increased costs to Rentokil Initial (and with effect from Completion, the Combined Group), directly for its compliance, or indirectly to the extent suppliers increase prices of goods and services because of increased compliance costs, excise taxes or the reduced availability of raw materials.

Following Completion, approximately 60 per cent. of the Combined Group’s total revenues is expected to come from North America and therefore the Combined Group may face increased exposure to potential future claims or litigation given the more litigious nature of the US market, including increased exposure to injunctive relief or damages granted by courts in respect of such claims, and regardless of the outcome of any litigation or claims, the Combined Group may incur additional costs in defending against such claims following Completion. An unfavourable outcome or settlement in any litigation may have an adverse effect on the Combined Group’s business, reputation, results of operations financial condition and/or prospects.

Termite damage claims and lawsuits related thereto could increase the Combined Group’s legal expenses and may adversely impact its business, reputation, results of operations, financial condition and/or prospects.

Following Completion, the Combined Group’s business may become subject to a significant number of damage claims related to termite activity in homes/commercial premises, often accompanied by a termite damage warranty/guarantee. Currently Terminix is subject to a significant number of damage claims related to its termite control services and termite damage warranties/guarantees. Damage claims may include circumstances when a customer notifies the Combined Group that they have experienced damage and the Combined Group reaches an agreement to remediate that damage (a “Non-litigated Claim”); and circumstances when a customer directly initiates litigation or arbitration proceedings or when the Combined Group does not reach an agreement with a customer to remediate the damage and that customer initiates litigation or arbitration proceedings (a “Litigated Claim”).

Some plaintiffs bringing Litigated Claims may seek to demonstrate a pattern and practice of fraud in connection with Litigated Claims and may seek awards, in addition to repair costs, which include punitive damages and damages for mental anguish.

Terminix has experienced higher Non-litigated Claim activity concentrated in its branches in Mobile, Alabama and Gulf Shores, Alabama, which comprise all of its customers in the area, (collectively, the “Mobile Bay Area”) related to Formosan termites, an invasive species, which has driven higher Non-litigated Claims expense. In addition, since the beginning of 2017, Terminix has been served with an increasing number of Litigated Claims, again primarily concentrated in the Mobile Bay Area and related to Formosan termite activity, which has driven higher Litigated Claims expense. The Combined Group may face even further claims in the Mobile Bay Area or in other regions and, regardless of the outcome of any Non-Litigated Claims or Litigated Claims, the Combined Group may incur additional costs in defending against such claims following Completion. An unfavourable outcome or settlement in any Non-Litigated Claims or Litigated Claims may have an adverse effect on the Combined Group’s business, reputation, results of operations financial condition and/or prospects.

In April 2021, the State of Mississippi brought litigation against Terminix related to its termite inspection and treatment practices (the “Mississippi Litigation”). Terminix disputes the claims made in the Mississippi Litigation and intends to defend the matter vigorously. However, given the uncertainty of litigation, the preliminary stage of the case, and the legal standards that must be met for success on the merits, it is not possible to predict with certainty the outcome of the Mississippi Litigation. The Combined Group intends to defend the Litigated Claims, including in particular the Mississippi Litigation, vigorously, and intends to take action to mitigate increasing claims costs; however, Rentokil Initial cannot give assurance that these mitigating actions will be effective in reducing claims or costs related thereto, nor can it give assurance that lawsuits or other proceedings related to termite damage claims will not materially affect its business, reputation, results of operations financial condition and/or prospects.

Following Completion, the Combined Group’s business may also become subject to state regulator claims related to trade practices, including termite renewal pricing, inspection and treatment practices (a “Regulator Claim”). Terminix has been subject to such claims in the past and has entered into settlements, for example with the Office of the Attorney General of the State of Alabama (the “AL AG”) and other Alabama state regulators. The Combined Group intends to defend any Regulator Claims and intends to take action to mitigate claims costs; however, Rentokil Initial plc cannot give assurance that these mitigating actions will be effective in reducing claims or costs related thereto, nor can it give assurance that lawsuits or other proceedings related to trade practices will not materially affect its business, reputation, results of operations financial condition and/ or prospects.

Compliance with, or violation of, environmental, health and safety laws and regulations, including laws pertaining to the use of pesticides, could result in significant costs that adversely impact Rentokil Initial’s (and with effect from Completion, the Combined Group’s) business, reputation, results of operations, financial condition and/or prospects.

The pest control industry is subject to various laws and regulations regarding environmental and health and safety matters. Among other things, these laws regulate the emission or discharge of materials into the environment, the use, storage, treatment, disposal, transportation and management of hazardous substances and wastes, the impact of chemicals (including fumigant gases), as well as pesticide and biocide products, on human health and safety and the environment, and the protection of the health and safety of its colleagues and the public.

These laws also impose liability for the costs of investigating and remediating, and damages resulting from, present and past releases of hazardous substances, including releases by former sites or by prior owners or operators of sites Rentokil Initial (and with effect from Completion, the Combined Group) currently owns or operates. These laws and regulations can result in costs associated with transporting and managing hazardous materials and waste disposal and plant site clean-up, fines, penalties, orders requiring corrective action or suspending or otherwise impacting Rentokil Initial’s (and with effect from Completion, the Combined Group’s) operations or other sanctions if it is found to be in violation of law, as well as modifications, disruptions or discontinuation of certain operations or types of operations including product recalls and reformulations. Changes in such laws and regulations, including among others, air, water, chemical and product regulations, could impact the sales of some of Rentokil Initial’s (and with effect from Completion, the Combined Group’s) products or services. In addition to an increase in costs of manufacturing and delivering products, a change in production regulations or product regulations could result in interruptions to Rentokil Initial’s (and with effect from Completion, the Combined Group’s) business and potentially cause economic or consequential losses should it be unable to meet the demands of its customers for products.

Products used by Rentokil Initial (and with effect from Completion the Combined Group) containing pesticides generally must be registered with the relevant governmental agencies or authorities before they can be sold or applied. The failure to obtain, or the cancellation of, any such registration, or the withdrawal from the marketplace of such pesticides, could have an adverse effect on Rentokil Initial’s (and with effect from Completion, the Combined Group’s) business, the severity of which would depend on the products involved, whether other products could be substituted and whether competitors were similarly affected. The pesticides Rentokil Initial uses (and with effect from Completion, the Combined Group will use) are manufactured by independent third parties and are evaluated by the relevant governmental authorities or agencies as part of its ongoing exposure risk assessment. Any of these authorities or agencies may decide that a pesticide Rentokil Initial uses will be limited or will not be re-registered for use in the relevant jurisdiction. Rentokil Initial plc cannot predict the outcome or the severity of the effect of any particular authority’s or agency’s continuing evaluations. In addition, the use of certain pesticide products is regulated by various international, national, federal, state, provincial and local environmental and public health agencies and bodies. Some of Rentokil Initial’s (and with effect from Completion, the Combined Group’s) products may also become subject to bans or restrictions due to animal cruelty concerns. Given Rentokil Initial’s dispersed locations, distributed operations and numerous colleagues and franchise associates, it may be unable to prevent violations of these or other laws and regulations or misuse of products by colleagues or others from occurring. Even if Rentokil Initial (and with effect from Completion, the Combined Group) is able to comply with all such laws and regulations and obtain all necessary registrations and licenses, the pesticides or other products Rentokil Initial (and with effect from Completion, the Combined Group) applies or uses, or the manner in which it applies or uses them, could be alleged to cause injury to the environment, to people or to animals, or such products could be banned in certain circumstances. The laws and regulations may also apply to third-party vendors who are hired to repair or remediate property and who may fail to comply with environmental laws, health and safety laws and regulations and subject Rentokil Initial (and with effect from Completion, the Combined Group) to risk of legal exposure. The costs of compliance, non-compliance, investigation, remediation, combating reputational harm or defending civil or criminal proceedings, products liability, personal injury or other lawsuits could have a material adverse impact on Rentokil Initial’s (and with effect from Completion, the Combined Group’s) business, reputation, results of operations, financial condition and/or prospects.

International, national, federal, state, provincial and local agencies and bodies regulate the disposal, handling and storage of waste, discharges from Rentokil Initial’s (and with effect from Completion, the Combined Group’s) facilities and the investigation and clean-up of contaminated sites. Rentokil Initial (and with effect from Completion, the Combined Group) could incur significant costs, including investigation and clean-up costs, fines, penalties and civil or criminal sanctions and claims by third parties for property damage and personal injury, as a result of violations of, or liabilities under, such laws and regulations enforced by these agencies and bodies. Liability under laws and regulations can be imposed on a joint and several basis and without regard to fault or the legality of the underlying conduct. In addition, potentially significant expenditures could be required to comply with environmental, health and safety laws and regulations, including requirements that may be adopted or imposed in the future.

A violation of health and safety or environmental laws or regulations relating to Rentokil Initial’s (and with effect from Completion, the Combined Group’s) operations or a failure to comply with the instructions of relevant health and safety authorities, environmental agencies or internal policies could lead to, among other things, personal injury, negative publicity and reputational damage, fines, costly compliance procedures, litigation and withdrawal of licenses to operate. Such violations could, therefore, have an adverse effect on Rentokil Initial’s (and with effect from Completion, the Combined Group’s) business, reputation, results of operations financial condition and/or prospects.

Rentokil Initial is (and with effect from Completion, the Combined Group will be) required to comply with stringent, complex and evolving laws, rules, regulations and standards in many jurisdictions, as well as contractual obligations, relating to data privacy and security. Any actual or perceived failure to comply with these requirements could have a material adverse effect on its business.

Rentokil Initial is (and with effect from Completion, the Combined Group will be) required to comply with stringent, complex and evolving laws, rules, regulations and standards in many jurisdictions, as well as contractual obligations, relating to data privacy and security. Ensuring that its collection, use, transfer, storage and other processing of personal information complies with such requirements can increase operating costs, impact the development of new products or services, and reduce operational efficiency.

Internationally, virtually every jurisdiction in which Rentokil Initial operates has established its own data privacy and security legal framework with which it must comply. The cost of compliance, and the potential for fines and penalties for non-compliance, with data privacy and security laws and regulations may have a significant adverse effect on Rentokil Initial’s (and with effect from Completion, the Combined Group’s) business, reputation, results of operations, financial condition and/or prospects.

If Rentokil Initial (and with effect from Completion, the Combined Group) is otherwise unable to transfer personal data between and among countries and regions in which it operates, it could affect the manner in which Rentokil Initial (and with effect from Completion, the Combined Group) provides its services, the geographical location or segregation of its relevant systems and operations, and could adversely affect its financial results. In addition, such procedures and controls, which Rentokil Initial operates (and with effect from Completion, the Combined Group will operate) to comply with relevant data privacy and security requirements in the jurisdictions it operates, may not be effective in ensuring compliance or preventing unauthorised transfers of personal data.

While Rentokil Initial strives to publish and prominently display privacy policies that are accurate, comprehensive, and compliant with applicable laws, rules regulations and industry standards, it cannot ensure that its privacy policies and other statements regarding its practices will be sufficient to protect it from claims, proceedings, liability or adverse publicity relating to data privacy and security. Although Rentokil Initial endeavours to comply with its privacy policies, Rentokil Initial (and with effect from Completion, the Combined Group) may at times fail to do so or be alleged to have failed to do so. If its public statements about its use, collection, disclosure and other processing of personal information, whether made through its privacy policies, information provided on its website, press statements or otherwise, are alleged to be deceptive, unfair or misrepresentative of its actual practices, Rentokil Initial (and with effect from Completion, the Combined Group) may be subject to potential government or legal investigation or action.

Rentokil Initial’s (and with effect from Completion, the Combined Group’s) compliance efforts are further complicated by the fact that data privacy and security laws, rules, regulations and standards around the world are rapidly evolving, may be subject to uncertain or inconsistent interpretations and enforcement, and may conflict among various jurisdictions. Any failure or perceived failure by Rentokil Initial (and with effect from Completion, the Combined Group) to comply with its privacy policies, or applicable data privacy and security laws, rules, regulations, standards or contractual obligations, or a security breach that leads to theft or other unauthorised access to, or unauthorised loss, destruction, use, modification, acquisition, disclosure, release or transfer of personal information, including customer, colleague, supplier or Rentokil Initial’s (and with effect from Completion, the Combined Group’s) proprietary, sensitive or confidential data, may result in requirements to modify or cease certain operations or practices, the expenditure of substantial costs, time and other resources, proceedings or actions against it, legal liability, governmental investigations, enforcement actions, claims, fines, judgments, awards, penalties, sanctions and costly litigation (including class actions). Any of the foregoing could lead to significant reputational damage, distract management and technical personnel, increase its costs of doing business, adversely affect the demand for its products and services, and ultimately result in the imposition of liability, any of which could have a material adverse effect on Rentokil Initial’s (and with effect from Completion, the Combined Group’s) business, results of operations, financial condition and/or prospects.

Changes in tax laws and unanticipated tax liabilities could materially and adversely affect the taxes Rentokil Initial pays (and with effect from Completion, the Combined Group will pay) and its profitability.

Rentokil Initial operates (and with effect from Completion, the Combined Group will operate) across many different tax jurisdictions and is subject to periodic tax audits which sometimes challenge the basis on which local tax has been calculated and/or withheld. Successful challenges by local tax authorities may have an adverse impact on profitability and cash flow. Unanticipated non-compliance with relevant tax legislation and/ or reporting requirements may result in material unprovided tax charges relating to prior years which could have a material adverse effect on Rentokil Initial’s (and with effect from Completion, the Combined Group’s) business, reputation, results of operations, financial condition and/or prospects.

Completion will result in Rentokil Initial becoming subject to US regulations which differ from the regulations to which Rentokil Initial is currently subject. Current and future US regulations could have an adverse effect on the results of operations, business and financial position of Rentokil Initial following Completion.

Following Completion, as a result of the registration of Rentokil Initial ADSs with the SEC, it is expected that Rentokil Initial plc will be subject to US securities laws, including the Sarbanes-Oxley Act of 2002 as a foreign private issuer. These regulations are different from the regulations to which Rentokil Initial is currently subject and therefore pose an increased compliance burden on Rentokil Initial and, particularly where supplemented by new regulations, could lead to higher costs and greater complexity, and potential reputational damage, regulatory sanctions or fines in connection with breach. Following Completion, the Combined Group could face increased exposure to other US federal, state and local laws and regulations (including tax laws), including the US Foreign Corrupt Practices Act of 1977, with respect to Rentokil Initial’s worldwide activities, as a result of its increased presence in the US. The enactment of unduly onerous and restrictive regulation may adversely affect Rentokil Initial plc’s share price and could have a material adverse effect on the results of operations, business and/or financial condition of Rentokil Initial.

As a “foreign private issuer”, Rentokil Initial plc would not be required to comply with all of the periodic disclosure and current reporting requirements of the 1934 Act and governance requirements of the NYSE that apply to a US domestic issuer. It is possible that Rentokil Initial plc could lose foreign private issuer status in the future. The determination of foreign private issuer status is made annually on the last business day of an issuer’s second fiscal quarter. As such, Rentokil Initial plc will re-assess its status as a foreign private issuer as of the last business day of the second fiscal quarter of 2023. Rentokil Initial plc would lose foreign private issuer status if more than 50 per cent. of its common shares are directly or indirectly held by residents of the United States and it fails to meet the additional requirements necessary to maintain its foreign private issuer status. These additional requirements relate to the citizenship and residency of its directors and officers, the location of its assets, and whether its business is principally administered in the United States. If Rentokil Initial plc ceases to be a foreign private issuer, it will be required to comply with reporting, disclosure, compliance and governance requirements that are applicable to US domestic issuers. This could result in significant additional legal, accounting and other expenses, as well as increased demands on management’s time.

Risks relating to financing

Adverse credit and financial market events and conditions could, among other things, impede access to or increase the cost of financing, which could have a material adverse impact on Rentokil Initial’s (and with effect from Completion, the Combined Group’s) business, results of operations, financial condition and/or prospects.

Disruptions in credit or financial markets could make it more difficult for Rentokil Initial (and with effect from Completion, the Combined Group) to obtain, or increase its cost of obtaining, financing for its operations or investments or to refinance its indebtedness, or cause lenders to depart from prior credit industry practice and not give technical or other waivers under applicable agreements governing such indebtedness to the extent Rentokil Initial (and with effect from Completion, the Combined Group) may seek them in the future, thereby causing it to be in default. There is no assurance that Rentokil Initial (and with effect from Completion, the Combined Group) will be able to refinance or extend the maturity of its indebtedness on favourable terms, or at all. Any inability to refinance Rentokil Initial’s (and with effect from Completion, the Combined Group’s) indebtedness on favourable terms could have a material adverse effect on its business, results of operations, financial condition and/or prospects.

The agreements and instruments governing Rentokil Initial’s indebtedness contain restrictions and limitations that could impact Rentokil Initial’s (and with effect from Completion, the Combined Group’s) ability to operate its business.

As of 30 June 2022, Rentokil Initial had aggregate outstanding indebtedness of £3.8 billion. The agreement governing the Revolving Facility, which is expected to increase to US$1 billion at Completion, the Bridge Facility and the New Senior Notes contain undertakings that, collectively, among other things, restrict Rentokil Initial’s (and with effect from Completion, the Combined Group’s) ability to: (i) transfer or sell assets by way of a Class 1 transaction (as such term is defined in the Listing Rules); (ii) create security over its assets in excess of a certain amount; (iii) issue debt instruments at subsidiary level in excess of a certain amount; and (iv) issue trade instruments in excess of a certain amount.

Rentokil Initial’s (and with effect from Completion, the Combined Group’s) ability to comply with the undertakings and restrictions contained in each of the agreements governing the Revolving Facility, the Bridge Facility, the New Senior Notes and the instruments governing its other indebtedness may be affected by economic, financial and industry conditions beyond its control including credit or capital market disruptions. The breach of any of these covenants or restrictions could result in a default that would permit the applicable lenders or noteholders to declare all amounts outstanding thereunder to be due and payable, together with accrued and unpaid interest. In any such case, Rentokil Initial (and with effect from Completion, the Combined Group) may be unable to borrow under the Revolving Facility and/or any such other facility and may not be able to repay the amounts due under such facility or its other outstanding indebtedness. This could have materially adverse consequences to Rentokil Initial’s (and with effect from Completion, the Combined Group’s) business, reputation, results of operations, financial condition and/or prospects and could cause it to become bankrupt or insolvent.

A lowering or withdrawal of the ratings, outlook or watch assigned to its debt securities by rating agencies may increase Rentokil Initial’s (and with effect from Completion, the Combined Group’s) future borrowing costs and reduce its access to capital.

Rentokil Initial’s indebtedness has primarily investment grade ratings, and any rating, outlook or watch assigned could be lowered or withdrawn entirely by a rating agency if, in that rating agency’s judgement, current or future circumstances change relating to the basis of the rating, outlook or watch, such as adverse changes to Rentokil Initial’s (and with effect from Completion, the Combined Group’s) business. Any future lowering of its ratings, outlook or watch likely would make it more difficult or more expensive for Rentokil Initial (and with effect from Completion, the Combined Group) to obtain debt financing.

Rentokil Initial (and with effect from Completion, the Combined Group) may be able to incur substantially more indebtedness. This could further exacerbate the risks associated with Rentokil Initial’s indebtedness.

Rentokil Initial has incurred approximately US$2.0 billion of additional debt in connection with the Transaction and may incur up to a further US$700 million of additional debt in connection with the Transaction. Rentokil Initial may incur substantial additional indebtedness in the future (the terms of the instruments governing Rentokil Initial’s indebtedness would not fully prohibit it from doing so). If new indebtedness is added to Rentokil Initial’s current indebtedness levels, the related risks it faces would increase, and it may not be able to meet all of its debt obligations.

Risks related to the Rentokil Initial Shares and Rentokil Initial ADSs

Current Rentokil Initial Shareholders will have a reduced ownership and voting interest after the Transaction.

Upon Completion, Rentokil Initial plc expects to issue approximately 645 million New Rentokil Initial Shares, represented by approximately 129 million New Rentokil Initial ADSs to Terminix Shareholders pursuant to the Merger Agreement. As a result, it is expected that, immediately after Completion, existing Rentokil Initial Shareholders will own approximately 74 per cent. of the outstanding Rentokil Initial Shares and former Terminix Shareholders who receive New Rentokil Initial ADSs in the Transaction will own approximately 26 per cent. of the outstanding Rentokil Initial Shares. In addition, Rentokil Initial Shares may be issued from time to time following Completion to holders of Terminix Holdings equity awards on the terms set forth in the Merger Agreement.

Resales of Rentokil Initial Shares and Rentokil Initial ADSs following the Transaction may cause the market value of Rentokil Initial Shares to decline.

Rentokil Initial plc expects that it will issue up to approximately 645 million Rentokil Initial Shares at Completion. The issuance of New Rentokil Initial Shares and the New Rentokil Initial ADSs by which those Rentokil Initial Shares are represented, and the sale of Rentokil Initial Shares and/or Rentokil Initial ADSs from time to time could have the effect of depressing the market value for Rentokil Initial Shares and Rentokil Initial ADSs as a consequence of the Transaction. The increase in the number of Rentokil Initial Shares or Rentokil Initial ADSs may lead to sales of such Rentokil Initial Shares or Rentokil Initial ADSs or the perception that such sales may occur, either of which may adversely affect the market for, and the market value of, Rentokil Initial Shares or Rentokil Initial ADSs.

The market value of Rentokil Initial Shares and Rentokil Initial ADSs may decline as a result of the Transaction.

The market value of Rentokil Initial Shares and Rentokil Initial ADSs may decline as a result of the Transaction if, among other things, the Combined Group is unable to achieve the expected growth in revenues and earnings, or if the operational cost savings estimates in connection with the integration of Rentokil Initial’s and Terminix’s businesses are not realised or if the transaction costs related to the Transaction are greater than expected. The market value also may decline if the Combined Group does not achieve the perceived benefits of the Transaction as rapidly or to the extent anticipated by the market or if the effect of the Transaction on the Combined Group’s business, results of operations, financial condition and/or prospects is not consistent with the expectations of financial or industry analysts.

The share price of publicly traded companies can be highly volatile and Rentokil Initial plc’s share price may fluctuate.

Following Completion, the value of any investment in Rentokil Initial Shares may increase or decrease abruptly which may prevent Rentokil Initial Shareholders from being able to sell their Rentokil Initial Shares or Rentokil Initial ADSs at or above the price they paid for them. The price of the Rentokil Initial Shares and Rentokil Initial ADSs may fall in response to market perception of the Combined Group and various other events as described more fully in this Part I (Risk Factors). Any of these factors, some of which will be outside of the Combined Groups’ control, may impact the price and performance of the Rentokil Initial Shares and Rentokil Initial ADSs.

As Rentokil Initial plc is a holding company and substantially all of its operations will be conducted through its subsidiaries, its ability to pay dividends on the Rentokil Initial Shares depends on its ability to obtain cash dividends or other cash payments or to obtain loans from such entities.

Rentokil Initial plc’s ability to pay dividends is limited under English company law, which limits a company to only pay cash dividends to the extent it has distributable reserves and cash available for this purpose. Rentokil Initial plc conducts substantially all of its operations through its subsidiaries and such entities will generate substantially all of its operating income and cash flow. As a holding company, Rentokil Initial plc’s ability to pay dividends in the future is affected by a number of factors, principally its ability to receive sufficient dividends from its subsidiaries. The ability of such entities to make dividend payments to Rentokil Initial plc depends largely on their financial condition and ability to generate profits. In addition, because Rentokil Initial plc’s subsidiaries are, and the Combined Group’s subsidiaries will be, separate and distinct legal entities, they will have, to the extent they have not agreed otherwise by entering into a separate agreement with Rentokil Initial plc, no obligation to pay any dividends or to lend or advance to Rentokil Initial plc funds and may be restricted from doing so by contract, including under financing arrangements, charter provisions, other shareholders or the applicable laws and regulations of the various countries in which they operate. Additionally, claims of the creditors of Rentokil Initial plc’s subsidiaries have priority over any claims that Rentokil Initial plc may have with respect to the assets of its subsidiaries. There can be no assurance that, in the long- term, the Combined Group’s subsidiaries will generate sufficient profits and cash flows, or otherwise prove willing or able, to pay dividends or lend or advance to Rentokil Initial plc sufficient funds to enable it to meet its obligations and pay interest, expenses and dividends, if any, on the Rentokil Initial Shares. The inability of one or more of these entities to pay dividends or lend or advance funds to Rentokil Initial plc could, in the long-term, have a material adverse effect on its business, reputation, results of operations, financial condition and/or prospects.

PART II

IMPORTANT NOTICES

Forward-looking statements

This document contains forward-looking statements. Forward-looking statements can sometimes be identified by the use of forward-looking terms such as “believes,” “expects,” “may,” “will,” “shall,” “should,” “would,” “could,” “potential,” “seeks,” “aims,” “projects,” “predicts,” “is optimistic,” “intends,” “plans,” “estimates,” “targets,” “anticipates,” “continues” or other comparable terms or negatives of these terms, but not all forward- looking statements include such identifying words. Forward-looking statements are based upon current plans, estimates and expectations that are subject to risks, uncertainties and assumptions. Should one or more of these risks or uncertainties materialise, or should underlying assumptions prove incorrect, actual results may vary materially from those indicated or anticipated by such forward-looking statements. Rentokil Initial plc can give no assurance that such plans, estimates or expectations will be achieved and therefore, actual results may differ materially from any plans, estimates or expectations in such forward-looking statements. Important factors that could cause actual results to differ materially from such plans, estimates or expectations include, among other things: the risks set out in Part I (Risk Factors) of this document; a condition to the Completion may not be satisfied; the occurrence of any event that can give rise to termination of the Transaction; Rentokil Initial is unable to achieve the synergies and value creation contemplated by the Transaction; Rentokil Initial is unable to promptly and effectively integrate Terminix’s businesses; management’s time and attention is diverted on transaction related issues; disruption from the Transaction makes it more difficult to maintain business, contractual and operational relationships; the credit ratings of Rentokil Initial decline following the Transaction; legal proceedings are instituted against Rentokil Initial or Terminix; Rentokil Initial or Terminix is unable to retain or hire key personnel; the announcement or the consummation of the Transaction has a negative effect on the market price of the Rentokil Initial Shares or Terminix Shares or on Rentokil Initial’s or Terminix’s operating results; evolving legal, regulatory and tax regimes; changes in economic, financial, political and regulatory conditions, in the United Kingdom, the United States and elsewhere, and other factors that contribute to uncertainty and volatility, natural and man-made disasters, civil unrest, pandemics (e.g., the COVID-19 pandemic), the ongoing war in Ukraine and the subsequent institution and extension of sanctions against various Russian organisations, companies and individuals, geopolitical uncertainty, and conditions that may result from legislative, regulatory, trade and policy changes associated with the current or subsequent US or UK administration; the ability of Rentokil Initial or Terminix to successfully recover from a disaster or other business continuity problem due to a hurricane, flood, earthquake, terrorist attack, war, pandemic, security breach, cyber-attack, power loss, telecommunications failure or other natural or man-made event, including the ability to function remotely during long-term disruptions such as the COVID-19 pandemic; the impact of public health crises, such as pandemics (including the COVID 19 pandemic) and epidemics and any related company or governmental policies and actions to protect the health and safety of individuals or governmental policies or actions to maintain the functioning of national or global economies and markets, including any quarantine, “shelter in place,” “stay at home,” workforce reduction, social distancing, shut down or similar actions and policies; actions by third parties, including government agencies; the risk that disruptions from the Transaction will harm Rentokil Initial’s or Terminix’s business, including current plans and operations; certain restrictions during the pendency of the acquisition that may impact Rentokil Initial’s or Terminix’s ability to pursue certain business opportunities or strategic transactions; and Rentokil Initial’s or Terminix’s ability to meet expectations regarding the accounting and tax treatments of the Transaction. Unlisted factors may present significant additional obstacles to the realisation of forward-looking statements.

Neither Rentokil Initial nor any of its associates or directors, officers or advisers provides any representation, assurance or guarantee that the occurrence of the events expressed or implied in any forward-looking statements in this document will actually occur. Investors are cautioned not to place undue reliance on these forward-looking statements. Other than in accordance with their legal or regulatory obligations (including under the Listing Rules, the Disclosure Guidance and Transparency Rules, the Prospectus Regulation Rules of the FCA and the Market Abuse Regulation), Rentokil Initial is under no obligation, and Rentokil Initial expressly disclaims any intention or obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise.

Nothing in this section or anywhere else in this document should be construed as qualifying the statement in respect of the Combined Group’s working capital set out in paragraph 19 of Part XIII (Additional Information) of this document.

No profit forecasts or estimates

Unless otherwise stated, no statement in this document, or incorporated by reference into this document, is intended to be or is to be construed as a profit forecast or estimate for any period and no other statement in this document should be interpreted to mean that earnings or earnings per share for Rentokil Initial plc or Terminix Holdings for the current or future financial years, or those of the Combined Group, would necessarily match or exceed the historical published earnings or core earnings per share for Rentokil Initial plc or Terminix Holdings.

Quantified synergy benefits

Statements of identified synergies and estimated costs savings relate to future actions and circumstances which by their nature involve risks, uncertainties and contingencies. As a consequence, the identified synergies and estimated cost savings referred to in this document may not be achieved, may be achieved later or sooner than estimated, or those achieved could be materially different from those estimated.

Rounding

Certain figures included in this document have been subjected to rounding adjustments. Accordingly, figures shown in the same category presented in different tables may vary slightly and figures shown as totals in certain tables may not be an arithmetic aggregation of the figures that precede them.

Presentation of financial information

Unless otherwise stated:

Unless otherwise indicated, financial information in this document relating to Rentokil Initial has been prepared in accordance with IFRS and financial information relating to Terminix has been prepared in accordance with US GAAP.

2020 Unaudited Restated Comparative Information

In the 2021 Accounts, Rentokil Initial restated the comparative information as at and for the year ended 31 December 2020 (the “2020 Unaudited Restated Comparative Information”) to adjust certain line items previously presented in the 2020 Accounts, in order to align with the presentation of the 2021 financial statements. As described in the Financial Review on page 149 of the 2021 Accounts, incorporated by reference herein, the following restatements were made:

The financial information included in this document for the year ended 31 December 2020 is derived from either the 2020 Accounts or the 2020 Unaudited Restated Comparative Information, as indicated.

Rentokil Initial has not restated the financial information for the year ended 31 December 2019 to reflect these same adjustments and as such, the financial information for 2019 included in this document, as extracted from the 2019 Accounts, is not directly comparable to the financial information for 2021 and the 2020 Unaudited Restated Comparative Information.

Pro forma financial information

In this document, any reference to “pro forma” financial information is to information which has been extracted without material adjustments from the Unaudited Pro Forma Financial Information contained in Part XII (Unaudited Pro Forma Financial Information for the Combined Group) of this document. The Unaudited Pro Forma Financial Information contained in Part XII (Unaudited Pro Forma Financial Information for the Combined Group) of this document is based on the historical financial information of Terminix contained in Part XI (Historical Financial Information on Terminix) and the financial information of Rentokil Initial incorporated by reference into this document as described in Part XIV (Documentation Incorporated by Reference) of this document, respectively. The unaudited pro forma income statement and statement of net assets are presented in GBP sterling. The Unaudited Pro Forma Financial Information has been prepared to illustrate the effect on (i) the income statement of Rentokil Initial for the six months ended 30 June 2022 as if the Transaction had taken place on 1 January 2021; (ii) the income statement of Rentokil Initial for the year ended 31 December 2021 as if the Transaction had taken place on 1 January 2021; and (iii) the statement of net assets of Rentokil Initial as if the Transaction had taken place on 30 June 2022.

The unaudited pro forma income statement and statement of net assets have been prepared for illustrative purposes only and, because of their nature, address a hypothetical situation and do not, therefore, represent Rentokil Initial’s or the Combined Group’s actual financial position or results. The pro forma financial information has been prepared under IFRS and on the basis set out in Part XII (Unaudited Pro Forma Financial Information for the Combined Group) of this document and in accordance with Item 13.3.3 R of the Listing Rules and in a manner consistent with the accounting policies adopted by Rentokil Initial in preparing the audited consolidated financial statements for the year ended 31 December 2021.

In addition to the matters noted above, the Unaudited Pro Forma Financial Information does not reflect the effect of anticipated synergies and efficiencies or the related costs of achieving these synergies that may result from the Transaction.

Non-GAAP measures

Certain operating and financial performance metrics contained in this document have not been audited and this document contains some financial measures which are not within the scope of IFRS or US GAAP (“Non- GAAP”) and which are used by the Company and Terminix Holdings, respectively, to assess the financial performance of their businesses. These measures include, among others, “Ongoing Revenue”, “Ongoing Operating Profit”, “Organic Revenue”, “Adjusted EPS”, “Adjusted EBITDA” and “Free Cash Flow” are included because the Company or Terminix Holdings believe that they are important supplemental measures of operating performance. These are not measures of operating performance derived from IFRS or US GAAP and should not be considered as substitutes for Rentokil Initial’s or Terminix’s financial results based on IFRS or US GAAP, as the case may be. In addition, these measures are not intended to be an indication of the Company’s ability to fund Rentokil Initial’s or, following Completion, the Combined Group’s cash requirements. Consideration should be given to the types of events and transactions that are excluded from the calculation of the measures. These Non-GAAP measures are not uniformly defined by all companies, and therefore comparability may be limited. Non-GAAP financial measures are used by the Company to make operating decisions because they facilitate internal comparisons of Rentokil Initial’s performance to historical results and to competitors’ results. The Directors also believe that they are useful in that they provide investors with alternative means to evaluate the underlying performance and position of Rentokil Initial and the Combined Group.

A reconciliation of Non-GAAP measures in relation to Rentokil Initial is included in the audited consolidated financial statements of Rentokil Initial for the financial years ended 31 December 2021, 31 December 2020 and 31 December 2019, and in the unaudited consolidated interim financial statements of Rentokil Initial for the six months ended 30 June 2022 and 30 June 2021, each of which has been incorporated by reference into this document as described in Part XIV (Documentation Incorporated by Reference) of this document.

A reconciliation of the following Non-GAAP measures in relation to Terminix Holdings is set out below.

The following table presents reconciliations of net income to Adjusted EBITDA:

Currencies

Unless otherwise indicated, all references in this document to “sterling”, “GBP”, “£”, “pence” or “p” are to the lawful currency of the United Kingdom; references to “EUR”, “Euro” or “€” are to the official currency of the Eurozone; and references to “US Dollars”, “USD” or “US$” are to the lawful currency of the US.

Market and industry information

Market data and certain industry forecasts used in this document were obtained from internal surveys, reports and studies, where appropriate, as well as market research, publicly available information and industry publications. Where third party information has been used in this document, the source of such information has been identified. The Company confirms that all third party information has been accurately reproduced and, as far as the Company is aware and able to ascertain from information published by that third party, no facts have been omitted which would render the reproduced information inaccurate or misleading.

Industry publications generally state that the information they contain has been obtained from sources believed to be reliable but that the accuracy or completeness of such information is not guaranteed. Similarly, internal surveys, reports and studies and market research, while believed by the Company to be reliable and accurately extracted by the Company for the purposes of this document, have not been independently verified and the Company makes no representation as to the accuracy of such information. See the section headed “Forward- looking statements” in this “Important Notices” section on page 33.

Publication on website and availability of hard copies

A copy of this document and all information incorporated into this document by reference to another source, will be made available on Rentokil Initial plc’s website at: https://www.rentokil-initial.com/generalmeeting.

If you have received notification of this document in electronic form, you may request a hard copy of this document and/or any information incorporated into this document by reference to another source by contacting Rentokil Initial plc’s registrars, Equiniti, at Aspect House, Spencer Road, Lancing, West Sussex, BN99 6DA, United Kingdom or, between 8.30 a.m. and 5.30 p.m. (BST), Monday to Friday (excluding English and Welsh public holidays), on 0333 207 6581 from within the UK or on +44 (0)121 415 0077 if calling from outside the UK (calls from outside the UK will be charged at the applicable international rate), with your full name and the full address to which the hard copy may be sent (calls may be recorded and monitored for training and security purposes). You may also request that all future documents, announcements and information to be sent to you in relation to the Transaction should be in hard copy form.

Incorporation by reference

Certain information in relation to Rentokil Initial is incorporated by reference in this document, as set out in Part XIV (Documentation Incorporated by Reference).

No incorporation of website information

The contents of Rentokil Initial’s and Terminix’s websites or any hyperlinks accessible from those websites do not form part of this document and investors should not rely on them.

Defined terms

Certain terms used in this document are defined and certain technical and other terms used in this document are set out in Part XV (Definitions) of this document.

Unless otherwise indicated, all references in this document to time of day are references to BST time.

All references to legislation in this document are to the legislation of England and Wales unless the contrary is indicated. Any reference to any provision of any legislation or regulation shall include any amendment, modification, re-enactment or extension thereof.

Words importing the singular shall include the plural and vice versa, and words importing the masculine gender shall include the feminine or neutral gender.

PART III

TO VOTE ON THE TRANSACTION AND ACTION TO BE TAKEN

To vote on the Transaction

This page should be read in conjunction with the rest of the document, in particular, the Notice of General Meeting included in Part XVI (Notice of General Meeting) of this document.

While it is currently anticipated that there will be no restrictions on social contact or meeting format at the time of the Rentokil Initial General Meeting, Rentokil Initial Shareholders should carefully consider whether or not it is appropriate to attend the Rentokil Initial General Meeting. Rentokil Initial Shareholders who wish to attend, should undertake a lateral flow test on the morning of the Rentokil Initial General Meeting and that any Rentokil Initial Shareholder who is experiencing any COVID-19 symptoms or has recently been in contact with anyone who has tested positive should not attend. Subject to conditions on the day of the meeting, Rentokil Initial Shareholders may be required to wear face masks.

In light of the potential for government restrictions relating to COVID-19 to change at short notice, Rentokil Initial Shareholders are strongly encouraged to consider submitting the Form of Proxy online or by post and to appoint the Chair of the Rentokil Initial General Meeting as their proxy to ensure their vote is counted even if attendance at the meeting is restricted or the shareholder is unable to attend. This means that the Chair of the Rentokil Initial General Meeting will be able to vote on their behalf, and in accordance with their instructions, at the Rentokil Initial General Meeting. You should complete, sign and return the accompanying Form of Proxy for use at the Rentokil Initial General Meeting, so as to be received by no later than 1.30 p.m. on 4 October 2022. Unless the Form of Proxy is returned by the time mentioned in the instructions printed on it, it will be invalid.

Electronic Proxy Appointment (“EPA”) is also available for the Rentokil Initial General Meeting. To use this facility, you must visit http://www.sharevote.co.uk and follow the instructions provided, or, if you have an account with Equiniti, you must visit https://www.shareview.co.uk and log on to your portfolio using your usual user ID and password. Once logged in, click “View” on the “My Investments” page, click on the link to vote and then follow the on-screen instructions. The Voting ID, Task ID & Shareholder Reference Number shown on the Form of Proxy will be required to complete the EPA procedure. EPA will not be valid if received later than 48 hours before the Rentokil Initial General Meeting or, in the case of any adjournment, later than 48 hours before the time fixed for the adjourned meeting and will not be accepted if found to contain a computer virus. Alternatively, if you are a user of the CREST system, you may appoint a proxy by following the procedures described in the CREST Manual available at http://www.euroclear.com. The CREST message must be received by the issuer’s agent RA19 by 1.30 p.m. on 4 October 2022.

If you require assistance, please telephone Equiniti on 0333 207 6581 from within the UK or on +44 (0)121 415 0077 (from outside the UK) between 8.30 a.m. and 5.30 p.m. (BST), Monday to Friday (excluding English and Welsh public holidays). Calls to the helpline from outside the UK will be charged at applicable international rates. Calls will be recorded and monitored for security and training purposes.

Please note that, for legal reasons, Equiniti cannot provide advice on the merits of the Transaction or give any legal, tax or financial advice.

Hard copies of any information incorporated into this document by reference to another source, sent to persons in electronic form or by means of being published on Rentokil Initial plc’s website, and all future documents, announcements and information required to be sent to persons in relation to the Transaction may be requested to be received by Rentokil Initial Shareholders in hard copy form by writing to Equiniti at Aspect House, Spencer Road, Lancing, West Sussex, BN99 6DA, United Kingdom or by calling Equiniti at the numbers provided above. A hard copy of any such documents will not be sent unless so requested.

Action to be taken

For the reasons set out in this document, the Board unanimously recommends that Rentokil Initial Shareholders vote in favour of the Resolutions relating to the Transaction to be proposed at the Rentokil Initial General Meeting, as the Directors intend to do in respect of their own beneficial holdings of Rentokil Initial Shares, and that you take the action described below.

The Rentokil Initial General Meeting will be held at the offices of Freshfields Bruckhaus Deringer LLP at 100 Bishopsgate, London, EC2P 2SR, UK at 1.30 p.m. on 6 October 2022. The Transaction requires approval of Rentokil Initial Shareholders at the Rentokil Initial General Meeting.

If you received a Form of Proxy, you are requested to complete and return your form as soon as possible. If you have registered to appoint a proxy electronically, and have thus not received a Form of Proxy, you should follow the instructions in the email you received notifying you of the availability of this document.

The Transaction will require approval by Rentokil Initial Shareholders at the Rentokil Initial General Meeting to be held at the offices of Freshfields Bruckhaus Deringer LLP at 100 Bishopsgate, London, EC2P 2SR, UK at 1.30 p.m. on 6 October 2022. The Transaction constitutes a Class 1 transaction for Rentokil Initial plc under the Listing Rules and will require the passing by Rentokil Initial Shareholders of the Resolutions to be proposed at the Rentokil Initial General Meeting.

In light of the potential for government restrictions relating to COVID-19 to change at short notice, Rentokil Initial Shareholders are strongly encouraged to consider submitting the Form of Proxy online or by post and to appoint the Chair of the Rentokil Initial General Meeting as their proxy to ensure their vote is counted even if attendance at the meeting is restricted or the shareholder is unable to attend. Voting by proxy ahead of the meeting will not prevent any Rentokil Initial Shareholder from attending and voting at the meeting.

Rentokil Initial Shareholders entitled to vote at the Rentokil Initial General Meeting may appoint a proxy electronically by logging on to the following website: http://www.sharevote.co.uk and following the instructions provided. Alternatively, if you have an account with Equiniti, log on to your portfolio at https:// www.shareview.co.uk using your usual user ID and password and clicking “View” on the “My Investments” page, then click on the link to vote and follow the on-screen instructions. The Voting ID, Task ID & Shareholder Reference Number shown on the Form of Proxy will be required to complete the procedure. For an electronic proxy appointment to be valid, the appointment must be received by Rentokil Initial plc’s registrar, not less than 48 hours before the time fixed for the Rentokil Initial General Meeting. Full details of the procedure to be followed to appoint a proxy electronically are given on the website.

To appoint a proxy or to give or amend an instruction to a previously appointed proxy via the CREST system, by following the procedures described in the CREST Manual available at http://www.euroclear.com, the CREST message must be received by the issuer’s agent RA19 not less than 48 hours before the time fixed for the Rentokil Initial General Meeting. For this purpose, the time of receipt will be taken to be the time (as determined by the timestamp applied to the message by the CREST applications host) from which the issuer’s agent is able to retrieve the message. After this time any change of instructions to a proxy appointed through CREST should be communicated to the proxy by other means. CREST personal members or other CREST sponsored members, and those CREST members who have appointed voting service provider(s), should contact their CREST sponsor or voting service provider(s) for assistance with appointing proxies via CREST. For further information on CREST procedures, limitations and system timings please refer to the CREST Manual. Rentokil Initial plc may treat as invalid a proxy appointment sent by CREST in the circumstances set out in the CREST Regulations.

Please complete and sign the enclosed Form of Proxy in accordance with the instructions printed on it and return it by post in the envelope provided to Rentokil Initial plc’s registrar, Equiniti at Aspect House, Spencer Road, Lancing, West Sussex, BN99 6DA, United Kingdom so as to be received as soon as possible and in any event not later than 1.30 p.m. on 4 October 2022.

The Form of Proxy must be returned by the time mentioned above, or it will be invalid.

Rentokil Initial Shareholders are entitled to appoint a proxy in respect of some or all of their Rentokil Initial Shares and may also appoint more than one proxy, provided that each proxy is appointed to exercise the rights attached to a different share or shares held by such holder. Rentokil Initial Shareholders who wish to appoint more than one proxy in respect of their holding of Rentokil Initial Shares should contact Equiniti for further Forms of Proxy.

If you have any questions about this document or the Rentokil Initial General Meeting, or are in any doubt as to how to complete the Form of Proxy, please contact Rentokil Initial plc’s registrars, Equiniti, at Aspect House, Spencer Road, Lancing, West Sussex, BN99 6DA, United Kingdom or call on 0333 207 6581 or, if telephoning from outside the UK, on +44 (0)121 415 0077, between 8:30 a.m. and 5.30 p.m. (BST), Monday to Friday (excluding English and Welsh public holidays). Calls to the helpline from outside the UK will be charged at applicable international rates. Calls may be recorded and monitored for security and training purposes. Please note that, for legal reasons, the helpline cannot provide advice on the merits of the Transaction or give any legal, tax or financial advice.

PART IV

EXPECTED TIMETABLE OF PRINCIPAL EVENTS AND INDICATIVE TRANSACTION STATISTICS

All times shown are BST times unless otherwise stated. All dates and times are based on the current expectations of Rentokil Initial and are subject to change, which will depend, among other things, on the date on which the Conditions to the Transaction are satisfied or, where applicable, waived. If any of the dates and/or times in this expected timetable change, the revised dates and/or times will be notified to Rentokil Initial Shareholders by announcement through the Regulatory Information Service of the London Stock Exchange.

The Rentokil Initial General Meeting will be held at the offices of Freshfields Bruckhaus Deringer LLP at 100 Bishopsgate, London, EC2P 2SR, UK.

Notes:

Notes:

PART VI

LETTER FROM THE CHAIRMAN OF RENTOKIL INITIAL

7 September 2022

To all Rentokil Initial Shareholders, and persons with information rights.

Dear Shareholder

PROPOSED ACQUISITION OF TERMINIX GLOBAL HOLDINGS, INC. BY RENTOKIL INITIAL PLC

On 14 December 2021, Rentokil Initial plc announced that it and Terminix Holdings had reached an agreement for the acquisition, by a subsidiary of Rentokil Initial plc, of the entire common stock of Terminix Holdings (the “Terminix Shares”), which will be effected through a statutory merger under the laws of Delaware.

The Transaction will combine two leading pest control businesses with a long cultural heritage, outstanding talent and strong focus on people, customers, delivering products and services responsibly, and benefiting society and the environment by acting in a responsible manner. The Combined Group will enhance shareholder value by creating an enlarged platform for growth, particularly in North America. It will have an attractive financial profile with the opportunity to increase net operating margins through cost reductions and operational efficiencies and a strong balance sheet to support growth through continued investments. The Transaction is in line with Rentokil Initial plc’s ongoing strategy of organic growth and growth through mergers and acquisitions, with a strong focus on the North America pest control market.

Under the terms of the Transaction, Terminix Shareholders will receive aggregate consideration comprised of approximately US$1.3 billion in cash and approximately 129 million Rentokil Initial plc American Depositary Shares (“New Rentokil Initial ADSs”) (each New Rentokil Initial ADS representing five Rentokil Initial Shares) (the “Merger Consideration”). Terminix Shareholders may elect to receive all cash or all stock consideration with respect to each Terminix Share (other than certain excluded Terminix Shares described in the Merger Agreement), subject to allocation and proration provisions in the event of oversubscription. Each Terminix Share for which no election or an invalid election is received will be deemed to have elected for all stock consideration.

Owing to its size, the Transaction constitutes a Class 1 transaction for the purposes of the Listing Rules, and therefore requires the approval by a majority of Rentokil Initial Shareholders. The Transaction is conditional on, amongst other things, such approval being obtained. Accordingly, a General Meeting has been convened for 1.30 p.m.  on 6 October 2022 at the offices of Freshfields Bruckhaus Deringer LLP at 100 Bishopsgate, London, EC2P 2SR, UK. The Notice of General Meeting is set out in Part XVI (Notice of General Meeting) of this document and an explanation of the Resolutions to be proposed is set out in paragraph 16 of Part VI (Letter from the Chairman of Rentokil Initial) of this letter.

Terminix Holdings was incorporated in the state of Delaware and the Terminix Shares are listed on the New York Stock Exchange (“NYSE”). Terminix Holdings is therefore not subject to the Listing Rules. Under the terms of the Merger Agreement, and, in accordance with Delaware law, the Transaction is also conditional on Terminix Shareholder approval.

On behalf of the Board, I am pleased to present this significant, value-creating opportunity AND RECOMMEND THE TRANSACTION to Rentokil Initial Shareholders. The purpose of this letter is to: (i) explain the background to and reasons for the Transaction; (ii) explain why the Directors believe that the Transaction is in the best interests of Rentokil Initial plc and Rentokil Initial Shareholders taken as a whole; and (iii)  recommend that, as a Rentokil Initial Shareholder, you vote in favour of the Resolutions to be proposed at the Rentokil Initial General Meeting, as the Board will in respect of their own shareholdings.

The notice of the Rentokil Initial General Meeting, at which your approval will be sought for the Transaction, is set out at the end of this document. In order to approve the Transaction, a majority of Rentokil Initial Shareholders attending, whether in person or by proxy, and voting at the Rentokil Initial General Meeting will need to vote in favour of the Resolutions. The Resolutions are described in further detail in paragraph 16 of this Part VI (Letter from the Chairman of Rentokil Initial), and set out in Part XVI (Notice of General Meeting) of this document. Details of the action you should take in order to cast your votes at the Rentokil Initial General Meeting are set out in “Action to be taken” on pages 38-40 of this document. The recommendation of the Directors is set out in paragraph 20 of this Part VI (Letter from the Chairman of Rentokil Initial).

Benefits of the Transaction for Rentokil Initial Shareholders

Increased scale and leadership in the global pest control market

Rentokil Initial and Terminix are significant players in the attractive, largely non-cyclical and growing pest control industry. The global pest control market size was approximately US$20 billion in 2019 and is projected to reach US$32 billion by 2027, exhibiting a compound annual growth rate (“CAGR”) of 6.31 per cent. during the forecast period.

Pest control is a largely non-discretionary and essential service. Growth characteristics of the global pest control market include increasing global populations, urbanisation, expansion of the middle classes, climate change, greater intolerance to pest incidence and rising transmission of vector borne diseases. Technological developments are also important factors contributing to the future growth in pest management, including rising demand for remote monitoring systems.

The Combined Group will become the leading global pest control company, with a customer base of approximately 4.9 million customers and approximately 57,700 colleagues globally. The Transaction will deliver a significantly enhanced network and improved route density, bringing the Combined Group closer to its customers, with its colleagues able to spend more time directly with customers and less time driving to and from customer visits.

Substantially increased scale in North America, providing an enlarged platform for profitable growth

The Combined Group will become the leading player in North America, the world’s largest pest control market (representing approximately 51 per cent. of the global market in 2021 and estimated to be worth approximately US$11 billion). As such, North America is of significant strategic importance and focus for Rentokil Initial. It is a highly competitive and fragmented market comprising over 20,000 pest control companies. Commercial pest control comprises the largest segment in North America at approximately 45 per cent. of the market, with residential comprising approximately 35 per cent. and termites at approximately 20 per cent. Rentokil Initial is currently a leading brand in commercial pest control, whilst Terminix is the most recognised brand for termite and residential pest control in the US, undertaking approximately 50,000 customer visits each day from over 380 locations across 45 states. Terminix generated pest control revenues of approximately US$2.0 billion for the year ended 31 December 2021. Post-Completion, the Combined Group will become the leading global pest control company, which will include a leading brand for residential and termite pest control in North America, as well as the leading global brand in commercial pest control.

Upon Completion, approximately 60 per cent. of the Combined Group’s total revenues are expected to come from North America. The Combined Group will create additional scale which will enable further investments in people, service quality, innovation, digital technology & applications and sustainability, to meet the future needs of customers and colleagues. Following Completion, the Combined Group intends to open a new science and innovation centre in the US focused on termite and residential pest control.

A complementary and synergistic combination

Rentokil Initial and Terminix have complementary service lines (combining Rentokil Initial’s expertise in commercial pest control globally with Terminix’s expertise in residential and termite pest control in North America). Rentokil Initial and Terminix’s geographic footprints in North America are also complementary, allowing greater route-density to be achieved, and presenting further opportunities to enhance operational efficiency. Both Rentokil Initial and Terminix have similar operating models which will enable the effective sharing of best practices in the future. In addition, Rentokil Initial is a leader in innovation and digital technology, creating services and products which can be rolled out to Terminix’s approximately 2.9 million pest control customers.

The Combined Group is expected to generate material annual pre-tax cost synergies of at least US$150 million (£129 million converted at the US$:£ exchange rate on the Latest Practicable Date) by the third full year post- Completion, owing to greater footprint density, procurement leverage, property rationalisation, duplicate administrative and overhead rationalisation, marketing, sales effectiveness, head office synergies and financing. Further detailed information on synergies is provided in paragraph 6 of this Part VI (Letter from the Chairman of Rentokil Initial). Both Rentokil Initial and Terminix have a strong track record of integrating acquisitions and are committed to creating a high-quality working environment with attractive opportunities for colleagues from both businesses to develop rewarding long-term careers in the Combined Group. The Board believes the Combined Group will be able to further differentiate itself from its competitors through its strong focus on people, customers, delivering products and services responsibly, and benefiting society and the environment by acting in a responsible manner.

An attractive financial profile

The Combined Group will have an attractive financial profile, with the opportunity to increase net operating margins through cost reductions and operational efficiencies by approximately one per cent. in each of the three full calendar years post-Completion. A strong balance sheet will support growth through continued investments in people, innovation, digital technologies and sustainability, and through further M&A opportunities around the world. Further detailed information on the Unaudited Pro Forma Financial Information is provided in Part XII (Unaudited Pro Forma Financial Information for the Combined Group) of this document. The Transaction will create a larger, highly diversified and more resilient business in Pest Control and Hygiene & Wellbeing. In North America, Pest Control will be well balanced between residential and termite (expected to be approximately 60 per cent. of revenues) and commercial (expected to be approximately 40 per cent. of revenues) pest services. Revenues from termite control for the financial year ended 31 December 2021 represented approximately 45 per cent. of Terminix’s residential revenues, and are expected to become approximately 20 per cent. of the Combined Group’s North America pest business upon Completion.

The Combined Group will also have a strong, complementary international Hygiene & Wellbeing business, with leading positions in 22 of its 67 geographical markets. Revenues from Hygiene & Wellbeing are expected to form approximately 21 per cent. of the total Combined Group revenues and the segment is expected to deliver 4 per cent. to 6 per cent. organic growth each year over the medium term from 2022. The Board remains committed to the growth and development of this business which it believes has the potential to become ‘The New Pest Control’ as set out at Rentokil Initial’s 2021 Capital Markets Day. The Combined Group will target the opportunity to cross-sell and up-sell both Pest Control and Hygiene & Wellbeing services to its enlarged customer base post-Completion.

Following Completion, the Combined Group will continue to target the medium-term growth rates set out in Rentokil Initial plc’s annual financial results announcement on 3 March 2022 for the year ended 31 December 2021. These are Ongoing Revenue growth of 6 per cent. to 9 per cent., including Organic Revenue growth of 4 per cent. to 5 per cent, Ongoing Operating Profit growth of over 10 per cent. and Free Cash Flow conversion of approximately 90 per cent. The medium-term Organic Revenue growth target for the Combined Group’s Pest Control segment will remain unchanged at 4.5 per cent. to 6.5 per cent. Medium-term growth targets for the Combined Group’s Hygiene & Wellbeing and Workwear (France) segments will also remain unchanged at 4 per cent. to 6 per cent. and 3 per cent. to 4 per cent. respectively.

The Combined Group will remain committed to Rentokil Initial plc’s current progressive dividend policy and expects to have leverage metrics consistent with a BBB investment grade rating within two years from Completion. Net debt to EBITDA is targeted to be 2.0x to 2.5x in the medium term.

Benefits of the Transaction for customers

Upon Completion, the Combined Group will have approximately 4.9 million customers and a shared commitment to providing the highest levels of customer satisfaction and to developing new, innovative ways to better serve its customer base. Its aim is to achieve this through:

Benefits of the Transaction for colleagues

The Combined Group presents additional opportunities for its approximate 57,700 colleagues and will introduce a set of commitments to all colleagues as set out below:

Terminix is a leading provider of residential and commercial pest control services, specialising in protection against termite damage, rodents, insects and other pests. Organised in Delaware in 2007, Terminix is the successor to various entities dating back to 1927 and is headquartered in Memphis, Tennessee and has operations in 24 countries and territories. Terminix makes over 50,000 home and business visits every day.

Terminix has scale and deep presence in the US and for the year ended 31 December 2021, 93 per cent. of Terminix’s revenue was generated by sales in the US and approximately 90 per cent. of the book value of its assets is located in the US. For the year ended 31 December  2021, Terminix recorded revenue of US$2.0 billion and net income of US$125 million.

Terminix operates three service lines: Residential Pest Management, Commercial Pest Management and Termite and Home Services. Over 80 per cent. of Terminix’s revenue comes from customers who enter into contracts with the option to renew periodically (e.g. annually, monthly or quarterly). Terminix’s revenues are not dependent on a single customer. However, a significant percentage of its revenue is concentrated in the southern and western regions of the US, with California, Texas and Florida collectively accounting for approximately one-third of Terminix’s revenues in 2021.

The following selected historical consolidated financial data prepared in accordance with US GAAP has been extracted without material adjustment from Terminix Holdings’ unaudited consolidated interim financial statements for the six months ended 30 June 2022 and 30 June 2021 and audited consolidated financial statements for the years ended 31 December 2021, 31 December 2020 and 31 December 2019 included within Part XI (Historical Financial Information on Terminix) of this document.